Aspen Group Refinances Hotel Lucia

PORTLAND-With the local hotel market not expected to get any worse, the Aspen Group recently obtained $10.5 million in first mortgage financing for Hotel Lucia, a 128-room boutique property built in 1909 that it acquired in 2002 for $10.5 million and then spent $5 million renovating. The 10-year loan has a 25-year amortization, a 70% loan-to-value ratio and an interest rate of less than 200 basis points over the 10-year treasury, which was in the high 4% range when the rate was locked in mid May. The new financing takes out the US Bank acquisition and renovation loan.Sonnenblick-Eichner Co. sourced the financing. Company principal Elliot Eichner tells GlobeSt.com that Aspen obtained a very good rate for an un-flagged property in part because the market is believed to have hit bottom. “Underwriters don’t think it will get any worse; consequently, there is a tremendous amount of capital chasing hotel deals and we’re getting very competitive pricing,” says Eichner. “If you’re a hotel owner, this is one of the best markets to be refinancing.”The property was originally built as the Imperial Hotel. The nine-story, 90,000-sf structure is located on the corner of Southwest Broadway and Stark, with Typhoon Restaurant as a ground-floor tenant. Post renovation, Hotel Lucia has been named among the 80 hottest new hotels in the world by Conde Nast Traveler magazine. It is the only hotel in the Pacific Northwest, and one of only 16 hotels in the US, to make the list. Despite the good interest rate, it could have been even better if the Aspen Group had acted earlier. Between submitting their application and locking their rate, the interest rate on the 10-year treasury rose between 75 and 80 basis points. Gordon Sondland and Howard Jacobs of the Aspen Group did not return phone calls seeking comment.