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Strategic Hotels closes on $750 million five-year unsecured facility
By Tali Rackner
Norfolk, Va., May 28 – Strategic Hotels & Resorts, Inc. obtained a $750 million five-year unsecured credit facility on Thursday, replacing an existing $300 million stock-secured revolving credit facility, according to a press release.
The new facility is comprised of a $450 million revolving credit facility and a $300 million term loan and has an up to $1 billion accordion feature.
Interest on the revolver is based on a leverage-based pricing grid that ranges from Libor plus 165 basis points to Libor plus 240 bps. Initial interest will be Libor plus 165 bps, a reduction from the previous facility’s pricing of Libor plus 200 bps.
Initial interest on the term loan is Libor plus 160 bps. The margin over Libor ranges from 160 bps to 235 bps, also based on leverage.
At closing, the company has $80 million outstanding on the revolver in addition to the $300 million funded term loan.
Deutsche Bank Securities Inc., J.P. Morgan Securities LLC and Bank of America Merrill Lynch served as co-lead arrangers for the deal. Deutsche Bank AG, New York Branch served as administrative agent, and JPMorgan Chase Bank, NA and Bank of America, NA served as syndication agents. BMO Harris Bank, NA, Capital One Bank, NA, PNC Bank and Wells Fargo Bank served as co-documentation agents.
In addition, Strategic Hotels closed on a $115 million term loan secured by the Ritz-Carlton Half Moon Bay hotel and simultaneously repaid the previously outstanding $209.6 million loan encumbered by the Westin St. Francis and the $93.1 million loan encumbered by the Fairmont Chicago.
Strategic is a real estate investment trust based in Chicago.
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