GlobeSt.com EXCLUSIVE: Presidio Hotel Group Refis Beach Resort

KAUAI, HI-Presidio Hotel Group of Fairfield, CA refinanced its 312-room beachfront resort here with $26.8 million in first mortgage and mezzanine financing from New York-based Ramsfield Hospitality Finance.Presidio acquired the Kauai Coconut Beach Resort in September 2003 for $9.5 million and launched a $10-million-plus renovation to turn the 10-acre property on Waipouli Beach into Hawaii’s first Courtyard by Marriott franchise. The financing pays off a short-term, $23-million bridge loan Presidio used to acquire and renovate the property, and provides extra funds to complete the renovation, which turned out to be more expensive than originally planned.Launched in 2003, Ramsfield bills itself as a provider of creative financing alternatives for hotel owners and investors. In this case, Ramsfield provided both a primary mortgage of $19.5 million and a $7.3-million mezzanine loan. The first mortgage, which Ramsfield intends to sell a senior participation interest at a later date, carries a floating interest rate above 30-day Libor, 25-year amortization period and a maturity of four years. The mezzanine financing carries a floating interest rate above 30-day Libor, but is an interest-only loan.Ramsfield president Richard Mandel tells GlobeSt.com that his company has been focused on mezzanine lending, but offered a one-stop shop to Presidio in order “to make sure they went with our money.” Looking ahead, Ramsfield says his firm is entertaining the idea of completing more full financings and then selling off senior pieces of the first mortgages to regional banks.”We’re trying to create a portfolio of these hotel loans all over the country,” says Mandel. “Selling off pieces enhances our return and also will allow us to diversify by having the same amount of money make more loans.”Just 10 minutes away from Lihue Airport, the Courtyard by Marriott Kauai will have a restaurant, lounge and luau grounds. Other amenities will include an outdoor swimming pool, whirlpool, shuffle board and 5,000 sf of meeting and banquet space.Presidio Hotel Group acquired the hotel from Pleasant Hawaiian Travel, a family company that owned the property for 20 years. During the renovation, rates are $60 a night and the rooms that are available for guests are largely booked up. Upon completion of the renovation, room rates will jump into the $150 range.