Machine Investment Group Recapitalizes Hollywood Hospitality Portfolio With New $208M Loan Facility
Transaction Delivers New Funding to Complete Two Under-Construction Properties, the Thompson Hotel and the tommie Hollywood Hotel, and Recasts Previous Senior Loan
April 26, 2021 – New York and Hollywood, CA – Machine Investment Group (“Machine”), a real estate investment platform based in New York that focuses on opportunistic, distressed and special situations investments across the United States, announced the $208 million recapitalization of a hospitality portfolio located in Hollywood, CA. The under-construction luxury lifestyle properties include the Thompson and tommie branded hotels, in addition to event and food & beverage spaces in the Citizen News Building (the “Portfolio”). The $208 million whole loan recasts the previous senior mortgage held by Calmwater Capital as a $136 million A-note and incorporates a $72 million B-note originated by Machine. The B-note was provided by a joint venture sponsored by affiliates of Machine Investment Group and Taconic Capital. The package provides new funding for the sponsor, Relevant Group, to complete construction of the two hotels by this summer.
“We’re pleased to deliver a financing solution to see these properties through to completion,” said Eric Rosenthal, Managing Partner of Machine. “We were able to move quickly after sourcing this transaction off-market, collaborating with the sponsor and existing lender toward a recapitalization that works well for all parties.”
Located at the intersection of North Wilcox and Selma Avenue, the 190-key Thompson Hollywood Hotel and the 212-key tommie Hollywood hotel will feature a combined 30,000 square feet of food and beverage space including two rooftop bars with unobstructed views of the Hollywood Hills. The Hollywood Citizen News Building will feature an additional 45,000 square feet of world class dining and event space. These properties neighbor the 178-key Dream Hollywood and are poised to further raise the visibility of Hollywood as a go-to hospitality destination.
Consistently one of the strongest hotel submarkets in the metro area, Hollywood is in high demand given the market’s longstanding appeal as an entertainment and technology industry stronghold, barriers to entry for new construction, the presence of media giants and strong demographics.
Recent Machine transactions include the $54.5 million acquisition of Stevens Creek Executive Park in San Jose, California, a redevelopment play in a stellar Silicon Valley location, and partnering with Kemmons Wilson Companies in a special situation financing transaction with Sotherly Hotels (NASDAQ: SOHO), providing a $30 million credit facility secured by a preferred equity interest in approximately 3,500 hotel rooms.
About Machine Investment Group
Machine Investment Group is a real estate investment platform focused on opportunistic, distressed and special situations across the United States. Founded by former senior executives from Garrison Investment Group, Andy Kwon and Eric Rosenthal, Machine invests primarily in the middle market, where its reputation as a reliable counterparty, its solutions-oriented approach and extensive lender relationships distinguishes the firm from the competition. Machine’s strict risk discipline, institutional operating processes and well-developed sourcing network has been cycle-tested and is designed to deliver consistent, opportunistic returns while minimizing losses.
About Taconic Capital
Taconic Capital is a global institutional investment firm that pursues an event driven, multi-strategy investment approach dedicated to generating strong risk-adjusted returns over multiple market cycles. Taconic was founded in 1999 by former Goldman Sachs partners, Frank Brosens and Ken Brody. The company has offices in New York, London and Hong Kong with over 100 employees worldwide. Taconic Capital oversees over $8 billion in total discretionary assets under. Taconic’s real estate holdings include over $2.5 billion of assets totaling approximately 30 million square feet of commercial properties.