Firm Represents Colony NorthStar, Inc. Joint Venture in $850 Million CMBS Loan

May 12, 2017

The transaction is the first major portfolio deal since Colony Capital merger with NorthStar.

Willkie represented Colony NorthStar, Inc. (CLNS) and Chatham Lodging Trust (CLDT) in connection with an $850 million refinancing secured by interests in 47 hotels located in 16 states. The originating lenders were affiliates of Morgan Stanley Bank, N.A., JPMorgan Chase Bank, National Association, and Citigroup Global Markets Realty Corp.

The floating rate financing provided in the form of a $754 million mortgage loan and a $96 million mezzanine loan, each of which carry a two year initial term with three extension options of one year each. The lenders anticipate securitizing the mortgage portion of the debt.

The properties comprising the portfolio are all branded as subsidiaries of Marriott International, Hilton Worldwide or Hyatt Hotels Corporation and were once part of the Innkeepers USA chain.  NorthStar Realty Finance acquired Cerberus Capital’s stake in the chain in 2014, with Chatham Lodging Trust remaining as a partner.

Willkie previously represented Colony Capital, Inc. in connection with the merger of Colony Capital, NorthStar Asset Management Group, and NorthStar Realty Finance, to form Colony NorthStar on January 10, 2017.

Colony NorthStar, Inc. is a leading global real estate and investment management firm with $56 billion of assets under management as of March 31, 2017, and significant property holdings in the healthcare, industrial and hospitality sectors, other real estate equity and debt investments and an embedded institutional and retain investment management business.  Since their inceptions, the predecessor entities of Colony NorthStar have invested in entities owning more than 4,000 hospitality assets with over 550,000 rooms worldwide.

Chatham Lodging Trust is a publicly-traded REIT that invests in upscale extended stay hotels and premium branded select service hotels. Chatham Lodging currently has ownership interest in 133 hotels with an aggregate of 18,210 keys across the United States.

The matter was handled by partners Thomas Henry, counsel Daniel Backer, and associates Justin Elliott, Jacob Moss, Steven Grant, and Jessica McGrath.