SAN FRANCISCO-KHP Fund II, a real estate private-equity fund sponsored by Kimpton Hotels & Restaurants, has received a $46-million senior loan from PCCP LLC to reposition two hotels: the 202-room Hotel Monaco Baltimore and the 183-room Hotel Palomar San Diego. The loan will allow Kimpton to more effectively market the Hotel Palomar San Diego to corporate groups and corporate guests as one of the premiere luxury boutique hotels in the market. It will also allow for more effective repositioning of Hotel Monaco Baltimore.
“Kimpton made two separate complicated acquisitions in distressed situations, and our loan will facilitate the turn-around of the two assets,” says Rob Cohen, SVP with PCCP. “Both hotels are among the highest quality in their respective markets but have under-performed in the last two years. The repositioning and turn-around of these assets is in line with Kimpton’s core competency, and we are confident they’ll be successful in those efforts.”
Cohen tells GlobeSt.com, “There will be minor capital expenditures on both hotels, primarily in the meeting spaces to allow ownership to better market to corporate groups.” He is unable to share the details of the loan, but says that KHP plans to hold onto both hotels for a few years.
Kimpton purchased the Hotel Palomar San Diego out of bankruptcy in June 2011. Located in downtown San Diego near the Gaslamp district, the Palomar property includes 14,300 square feet of meeting space, a 5,500-square-foot spa, an outdoor pool with a 7,000-square-foot deck, an adjacent 31,300-square-foot restaurant property occupied by House of Blues, as well as a recently re-concepted Saltbox Dining & Drinking restaurant. The Palomar opened in 2008 and features high-quality custom finishes throughout guestrooms and common areas. It was previously operated under the name Se Hotelby, an independent manager.
Kimpton purchased the note secured by the Hotel Monaco Baltimore from Capmark Bank in February 2011 and obtained fee title in April 2011. The Monaco is located in the former Baltimore & Ohio Railroad headquarters, a landmark building originally constructed in 1906. The prior developer restored and converted this historic building into a luxury boutique hotel that opened in 2009. In addition to guest rooms with luxury amenities, the Monaco is home to the award-winning B&O American Brasserie and offers 6,000 square feet of meeting space with an additional 3,000 square feet of space currently being converted to meeting facilities.
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Carrie Rossenfeld
Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.
