The co-investors in the loan include GE Real Estate Capital and KBC Bank NV. The participants invested a total of $201 million in the senior portion of the loan, while Massachusetts Mutual Life Insurance Co., Babson's parent, retained a portion of the senior note and all of the subordinate portion of the loan.

The transaction was Babson's largest single-borrower real estate financing deal to date, eclipsing a $395-million financing completed in 2001. "This deal is an example of Babson's ability to leverage its resources to originate, underwrite, close and syndicate large, highly structured real estate financing transactions," says Jeffrey J. Williams, a managing director of the Real Estate Finance Group at Babson. He adds that the firm wants to continue doing deals of this magnitude and larger. The Real Estate Finance Group of Babson manages more than $15 billion of real estate debt investments.

In September, Babson closed a $399.5-million loan to Sunstone Hotel Investors LLC. The borrower is comprised of subsidiaries of Sunstone Hotel Investors LLC, based in San Clemente, CA. In 1999, the senior management of the former REIT Sunstone Hotel Investors Inc., and Westbrook Partners, a Boston-based real estate investment firm, completed a management buyout of the REIT and took the company private. Westbrook Partners LLC is the sponsor and general partner of four separate real estate funds with total aggregate equity capital of nearly $4 billion. Babson, which was founded in 1940, manages approximately $78 billion, primarily for institutional investors.