Financing Unclear for Anchor Hotel in Convention Center

BOSTON-Despite recent published reports depicting the possibilities for Starwood Hotels & Resorts Worldwide, Inc. of winning financing for its anchor hotel in South Boston’s convention center as grim, those committed to the project say they are cautiously optimistic.

Richard Friedman, of Carpenter & Co., Starwood’s local partner, says “we’re in the process of getting financing. We are pursuing all avenues of conventional financing.” Friedman says that the company has until the first of December to secure financing.

Capital markets are notoriously difficult for hotel financing and convention center hotels are even harder to finance because the hotel’s success is so dependent on the success of the convention center. The recent tightening in the capital markets has made the prospect of putting together financing for this hotel that much more difficult. Typically, convention center hotels require major public subsidies.