Collateral Asset Class definition
Collateral Asset Class. Single hotel assets, hotel portfolios, and preferred positions in hotel entities. Full-service (branded and independent) hotels and resorts in upper-upscale to luxury segments along with branded select service hotels in upscale and mid-scale segments. Extended stay and economy assets may be considered if they constitute a minority position in a portfolio. • Location: Hotels located in the U.S. • Investment Size: Maximum single asset investment of $50 million (with typical range of $10 — $25 million) and up to $75 million for diversified portfolio. • Capital Stack Positioning: Typically a position in the capital structure within the 60% — 85% LTV range based upon cost in the case of a new acquisition and Sponsor/Investor underwriting in the case of assets already owned. Additional collateral support may allow for higher LTV positions. • Loan Maturity: Generally three to five years (including extensions) for floating rate loans, whereas three to ten years for fixed rate. In select cases, maturities may be shorter, particularly if loans are acquired, rather than originated. Floating rates will typically have at least twelve month lockouts and fixed rates will be structured with either defeasance or yield maintenance. • Debt Service Coverage: Assets will be at least 1.0x TTM coverage unless adequate collateral support (reserves, guarantees, etc.) is provided. • REIT Compliance: Investments will comply with the REIT Compliance requirements in the organizational documents of the Master Joint Ventures and Subsidiaries, unless otherwise approved by Investor in its sole and absolute discretion.
Collateral Asset Class. Single hotel assets, hotel portfolios, and preferred positions in hotel entities. Full-service (branded and independent) hotels and resorts in upper-upscale to luxury segments along with branded select service hotels in upscale and mid-scale segments. Extended stay and economy assets may be considered if they constitute a minority position in a portfolio. • Location: Hotels located in the U.S. • Investment Size: Maximum single asset investment of $50 million (with typical range of $10 - $25 million) and up to $75 million for diversified portfolio. • Capital Stack Positioning: Typically a position in the capital structure within the 60% - 85% LTV range based upon cost in the case of a new acquisition and Sponsor/Investor underwriting in the case of assets already owned. Additional collateral support may allow for higher LTV positions. • Loan Maturity: Generally three to five years (including extensions) for floating rate loans, whereas three to ten years for fixed rate. In select cases, maturities may be shorter, particularly if loans are acquired, rather than originated. Floating rates will typically have at least twelve month lockouts and fixed rates will be structured with either defeasance or yield maintenance. • Debt Service Coverage: Assets will be at least 1.0x TTM coverage unless adequate collateral support (reserves, guarantees, etc.) is provided. • REIT Compliance: Investments will comply with the REIT Compliance requirements in the organizational documents of the Master Joint Ventures and Subsidiaries, unless otherwise approved by Investor in its sole and absolute discretion. The Company desires to acquire an existing mezzanine loan (the “Loan”) at a discount to its par value. The Loan is described as follows: Original Principal Amount: $96,053,199 Interest Rate: LIBOR + 2.75% Current LIBOR: 4.32% Amortization: None Purchase Price: $82,705,726 Discount: $13,140,709 Discount Margin: 6.82% Sourcing Fee: $206,764 (0.25% of the Purchase Price) Unreimbursed Company Expenses: $0 Origination Fee: $0 The Purchase Price is the price required to achieve a zero net present value of the projected income stream from the Loan (e.g., interest payments projected using the forward LIBOR curve plus receipt of the Discount at maturity) using a discount rate equal to current LIBOR plus the desired Discount Margin.