ValueXpress has arranged a $5.42-million CMBS conduit loan for the refinance of a LaQuinta Inn & Suites constructed in 1989 in Jupiter, Florida. The property, a 3-story, 101-room interior-corridor hotel, was purchased by the sponsor in 2002. Each room features free high-speed Internet access, a large 27-inch TV with premium cable and HBO, a microwave and a refrigerator. The property has an outdoor pool and business center, and it offers a free continental breakfast.
The property is located minutes from Jupiter Island Park, two miles west of I-95 and three minutes from Florida beaches. In addition, the property is convenient to Palm Beach International Airport. Other attractions in the immediate vicinity of the hotel are Roger Dean Stadium, Juno Beach Pier, Jonathon Dickenson State Park and the historic Jupiter Lighthouse.
“The transaction was challenging in that the bank that held the loan on the property failed and the successor lender, the FDIC, sold the loan to a Florida community bank that immediately demanded full payment of the subject loan and other sponsor loans,” explained Gary Unkel, the ValueXpress originator on the transaction. “To protect his ownership of the asset, the sponsor was forced to place the property in bankruptcy, despite current payment history and good operating cash flow.”
“This is the fifth or sixth ‘defensive bankruptcy’ deal we have completed,” said Michael D. Sneden, Executive Vice President at ValueXpress. “Bankruptcy eliminates the competition, period, but CMBS looks at the reasoning behind the bankruptcy and performance of the asset, and if both make sense, we will do the deal. In fact, we market this feature of CMBS loans.”