Holiday Inn Express

$12,700,000 | Janesville, WI

Holiday Inn Express - Janesville, WI


David Turley, Janet Proscia and Jeffrey Pacailler arranged permanent financing for a 142-key Holiday Inn Express in Janesville, Wisconsin. The $12.7 million 10-year loan refinanced the existing $8.0 million GE Capital financing and returned the ownership team’s equity plus over $1.0 million in cash out to the partners. The rate was locked in the low 4%’s.

The borrower acquired the Holiday Inn Express in late 2012 with a significant PIP requirement – approximately $3.5MM to upgrade the public spaces, guest rooms and property exterior – in order to maintain the franchise. Following an intensive 10-month PIP renovation between mid-2013 and mid-2014, the property won IHG’s Renovation of the Year award for the upgrade’s transformative impact on the guest experience.

“The partners, Hospitality Guru Group, did an exceptional job identifying the potential of this hotel and then delivering an award-winning product to complete the business plan,” noted Jeff Pacailler. “The renovation was so well done that any concerns about the impact of future IHG Formula Blue requirements were silenced during the lender’s property inspection.”

David Turley added: “We are pleased to have delivered a comprehensive cash out above the borrower’s total cost basis less than 12 months after a $25,000/key renovation without the borrower paying a rate premium to do so. Our lender, Starwood Mortgage Capital, executed flawlessly on a tough deal.”

Founded in 1897, David Cronheim Mortgage Corporation and its affiliate companies, including Cronheim Hotel Capital, provide debt and equity capital for a wide spectrum of commercial real estate assets. Through their Channel Real Estate Funds affiliate they have provided equity capital for numerous real estate investments in an efficient and cost effective manner. Cronheim Mortgage maintains correspondent and/or servicing relationships with twelve institutional investors, mostly insurance companies, and currently services $2,000,000,000 of debt. The company and its insurance company correspondents have substantial debt and equity capital to invest in quality real estate at pricing below alternative sources, especially for long-term debt.

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