HOUSTON-Stout Street Hospitality has obtained a $42 million first mortgage loan to refinance the Magnolia Hotel here. UBS Securities LLC originated 10-year, non-recourse conduit loan, which took out a first mortgage and a second mortgage and provided extra proceeds.

Jones Lang LaSalle Hotels arranged the fixed-rate financing for the 314-room historic hotel. The firm’s Executive Vice President Mathew Comfort and Associate Mike Huth led the team.

Comfort tells GlobeSt.com that the Magnolia Hotel generated interest from both portfolio and CMBS lenders when brought to market about three months ago. “We initially thought a portfolio lender would be the best option because we weren’t sure how the CMBS guys would react to the fact that this hotel doesn’t have a major flag and its location in the Houston market, which has some new supply and hasn’t been as strong as other markets,” he explains. “The lack of flag narrowed the pool of lenders because there are certain lenders that will only lend on branded hotels.”