Construction needed to begin immediately in order to meet the grand opening deadlines of the franchise agreements…
Show me the Facts
- A 90 room Hilton flagged hotel property in Marysville, Washington.
- Borrowers are from British Columbia (foreign nationals) and are working with EB-5 investor dollars.
- SFG provided a $5,000,000 first position loan to complete a construction budget nearing $15,000,000.
- Borrowers brought about $10,000,000 in equity capital to the transaction through the EB-5 foreign borrower plan.
SFG dollars will be drawn after equity capital is used. While the borrowers could have funded this entirely out of pocket, they were looking to establish a U.S. based lending contact as they anticipate future projects in the Pacific Northwest. They had naturally heard of SFG, but were also referred to us through their law firm. Gaining familiarity with the construction lending process in the U.S. was one of the primary motivations for seeking a low leverage loan from SFG.
Location? Sponsorship?
The property location is excellent as it is right off the I-5 freeway near the Tulalip Casino, rapidly developing big box retailers as well as the Seattle Premium Outlets. Another attractive feature of this transaction for all involved was the quality team assembled to construct and manage the project. Borrowers have engaged one of the top hospitality builders in the area as their general contractor… who are actually finishing up a similar hotel construction project in downtown Bellevue.
Looking Back…
This loan transaction accomplished a couple of “firsts” for us:
- First transaction using EB-5 money
- First time we have constructed a hospitality property
If you are working with borrowers using EB-5 money, give us a call. There are a few key tips we can give you that will be of great help. We couldn’t have envisioned a better deal structure to facilitate SFG’s expansion into new lending opportunities. A special thank you to John Gordon MAI from Kidder Mathews Valuation Services for his expeditious assistance with a value analysis.
