Peachtree Group Originates $73 million in Construction and CPACE Financing

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Charles Talbert
VP, Corporate Communications
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ATLANTA (Jan. 17, 2024) – Officials of Peachtree Group today announced that the company originated $73 million in a construction loan and CPACE financing for the development of a 263-room dual-brand Home2 Suites (130-key) and Tru by Hilton Hotel (133-key) in San Diego, Calif., on behalf of Baxter Hotel Group, a San Diego‐based, vertically integrated real estate development and management company.  Baxter plans to begin construction on its 16-story, dual-branded hotel this month and expects a22-month construction timetable.

The Peachtree Group team originated a $50.4 million floating-rate construction loan over a three-year term and $22.6 million of fixed-rate commercial property clean energy (CPACE) financing amortized over 25 years, which in total represented 64% of the total development cost.

“We were able to execute an innovative capital stack with the addition of CPACE in an otherwise difficult financing market that provided ample capital for the construction to begin while saving the sponsor 200 basis points in interest rate spread,” said Jared Schlosser, Peachtree’s senior vice president, head of hotel origination and CPACE.

The construction budget has CPACE-eligible items, including seismic improvements, lighting, building envelope, HVAC, plumbing and qualifying soft costs.

The hotel will be located at 1357 5th Avenue and will cater to transient and extended-stay guests, offering a new product that has been historically underserved in the market. The high-quality amenities proposed are not typically seen in limited-service hotels, like sustainable designs to achieve Leadership in Energy and Environmental Design (LEED) certification, a ground-floor restaurant and a rooftop pool fully equipped with a restaurant and bar offering panoramic views of Downtown San Diego.

About Peachtree Group
Peachtree Group is an investment firm driving growth with a diverse portfolio of commercial real estate assets and other ventures. The company has executed hundreds of investments since its inception, focusing on real estate acquisition, development and lending valued at almost $9.3 billion in total market capitalization. Today, Peachtree manages over $2.5 billion in equity, augmented by services designed to protect, support and grow its investments. For more information, visit www.peachtreegroup.com.

 

Contact:                                                                                            

Charles Talbert                                                                                                  

678-823-7683                                                                                                    

ctalbert@peachtreegroup.com

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Debt Market Dislocation Creates $1 Billion Opportunity for Peachtree Group

Peachtree Group is thriving amid debt market dislocation, and anticipates deploying $1.0 billion in real estate credit investments within six months. ‍The credit investments primarily encompass originations for hotels, multifamily, industrial and student housing. In February, Peachtree closed one of the largest individual credit transactions in the firm's history with a $102.9 million three-year loan to recapitalize a 350‐room Marriott branded hotel in Sunnyvale, Calif.

ATLANTA (March 18, 2024) – Peachtree Group (“Peachtree”), a diversified commercial real estate investment firm, announced it has closed approximately $660 million in credit investments since Dec. 1, 2023, with an additional $350 million anticipated closing over the next 30 to 45 days.

The credit investments primarily encompass originations for hotels, multifamily, industrial and student housing.


In February, Peachtree closed one of the largest individual credit transactions in the firm's history with a $102.9 million three-year loan to recapitalize a 350‐room Marriott dual-brand AC Hotel Sunnyvale Moffett Park and TETRA Hotel, Autograph Collection in Sunnyvale, Calif.

The AC Hotel Sunnyvale Moffett Park

 

"We are witnessing heightened activity in response to the anticipation of sustained elevated interest rates and continued reductions in bank exposure. The pressing need to refinance maturing debt, estimated at $2.8 trillion in U.S. commercial real estate debt by the end of 2028, is a growing concern. Commercial real estate stakeholders are grappling with the challenges of increased capital costs and constrained liquidity, particularly in securing capital for acquisitions, recapitalizations and development initiatives,” said Greg Friedman, Peachtree Group’s managing principal and CEO.

Peachtree Group's credit division, formerly Stonehill, ranked as the 8th largest U.S. commercial real estate hotel lender by the Mortgage Bankers Association in its last loan origination rankings.

As a direct commercial real estate lender, it offers permanent loans, bridge loans, mezzanine loans, commercial property-asset clean energy (CPACE) financing and preferred equity investments across all commercial real estate sectors, with its origins in the hospitality industry.

Other notable credit transactions closed over the past 90 days:

  • $40.8 million first mortgage loan for the construction of a dual-branded Residence Inn and Home2 Suites in Montgomery, Ala.
  • $46.0 million in Commercial Property Assessed Clean Energy (“CPACE”) financing for the Thompson Hotel in Palm Springs, Calif.  
  • $36.2 million first mortgage loan for Courtyard by Marriott in Chevy Chase, Md.
  • $40.6 million first mortgage loan for Home2 Suites in Charlotte, N.C.
  • $34.5 million first mortgage loan for a multifamily complex in Gainesville, Fla.
  • $17.5 million first mortgage loan for student housing in Athens, Ga.  

About Peachtree Group
Peachtree Group is a vertically integrated investment management firm specializing in identifying and capitalizing on opportunities in dislocated markets, anchored by commercial real estate. Today, we manage billions in capital across acquisitions, development, and lending, augmented by services designed to protect, support and grow our investments. For more information, visit www.peachtreegroup.com.

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Contact:

CharlesTalbert

678-823-7683

ctalbert@peachtreegroup.com

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Peachtree Group Selected to Operate the Merrill Hotel, Muscatine

ATLANTA (Jan. 30, 2024) – Peachtree Group's hospitality management group has been selected to operate the Merrill Hotel, Muscatine, a Tribute Portfolio Hotel in downtown Muscatine, Iowa. The AAA Four-Diamond property comprises 122 guest rooms, a full-service restaurant, nearly 13,000 square feet of flexible meeting and event space, an outdoor terrace overlooking the Mississippi River, a heated indoor saltwater pool, and a fitness center.

ATLANTA (Jan. 30, 2024) – Peachtree Group's hospitality management group has been selected to operate the Merrill Hotel, Muscatine, a Tribute Portfolio Hotel in downtown Muscatine, Iowa. The AAA Four-Diamond property comprises 122 guest rooms, a full-service restaurant, nearly 13,000 square feet of flexible meeting and event space, an outdoor terrace overlooking the Mississippi River, a heated indoor saltwater pool, and a fitness center.

Built along the banks of the Mississippi River, the hotel opened in March 2018, offering some of the most luxurious amenities and accommodations in Iowa. The Merrill Hotel's prime location provides convenient access to the city's local restaurants and shops and benefits from the proximity to the Quad Cities - Davenport and Bettendorf in Iowa and Rock Island and Moline/East Moline in Illinois.

"We're truly delighted to have been chosen by Jim and Rebecca Howe to be the hotel's management operator," said Patrick Short, president hospitality management, Peachtree Group. "The Howe family embodies a steadfast dedication to unparalleled hospitality experiences. We will carry on their commitment to excellence by delivering exceptional guest experiences, enhancing and elevating the hotel's reputation while generating results commensurate with this exceptional hotel's status."

Peachtree Group's hospitality management operates premium-branded, limited-, select- and compact full-service hotels primarily in the upper-midscale and upscale segments. Today, the company manages 91 hotels across 27 brands with 11,180 rooms in 23 states. The Merrill Hotel, increased Peachtree Group's third-party operations to 28 hotels.

"Embracing an experienced management firm like Peachtree Group signifies a collaborative effort ensuring operational excellence while fostering a partnership geared towards the growth of our hotel, which continues to serve as one of the city's economic foundations," Jim Howe said.

"We take our role as stewards of this incredible hotel seriously, committed to keeping it at the heart of the town's culture and economy. It's a responsibility we embrace with dedication and pride," said Caroline Royster, vice president of business development hospitality management, Peachtree Group.

 

About Peachtree Group

Peachtree Group is an investment firm driving growth with a diverse portfolio of commercial real estate assets and other ventures. We’ve executed hundreds of investments since inception with a focus on real estate acquisition, development, and lending. Today, we manage billions in equity, augmented by services designed to protect, support, and grow our investments.

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Peachtree Group Provides $34.5 Million Loan for Acquisition and Renovation of 312-unit Multifamily Property in Florida

ATLANTA (Feb. 2, 2024) – Peachtree Group announced the company originated a $34.5 million loan for the acquisition and renovation of a 312-unit multifamily property in Gainesville, Fla., on behalf of Coastline Management Groups (Coastline), a Hollywood, Fla. based service-oriented real estate management company. The property, Pavilion on 62nd, is a 25-building, 312-unit multifamily used previously for student housing.

ATLANTA (Feb. 2, 2024) – Peachtree Group announced the company originated a $34.5 million loan for the acquisition and renovation of a 312-unit multifamily property in Gainesville, Fla., on behalf of Coastline Management Groups (Coastline), a Hollywood, Fla. based service-oriented real estate management company. The property, Pavilion on 62nd, is a 25-building, 312-unit multifamily used previously for student housing.

The Peachtree Group team originated the floating-rate bridge loan over a three-year term, representing 61% of the stabilized appraised value.

The multifamily property contains 31.74 acres and features two-, three- and four-bedroom units with onsite property management, two clubhouses, two swimming pools, workstation cubicles, a game room, a media room, rentable event room, a gym, indoor racquetball and half-court basketball, sand volleyball court, dog park and package receiving center.

Coastline will use approximately $5.0 million of the bridge loan proceeds to renovate unit interiors, convert four-bedroom units to three-bedroom units, expand the onsite amenities and complete deferred maintenance on exterior and common areas.

About Peachtree Group

Peachtree Group is an investment firm driving growth with a diverse portfolio of commercial real estate assets and other ventures. We’ve executed hundreds of investments since inception with a focus on real estate acquisition, development, and lending. Today, we manage billions in equity, augmented by services designed to protect, support, and grow our investments.