Wednesday, June 24, 2009
Red Roof Inn Defaults
Accor (owner of Motel 6) sold RRI for $1.3 billion back in 2007 to Citigroup's Global Special Situations Group (GSSG), Westmont Hospitality Group ("Westmont"), and Westbridge Hospitality Fund, and partially financed that with 2 pari passu loans spread across 4 CMBS deals totaling $366 million. The rest of the senior mortgage ($655mm) didn't make it into a CMBS, and is likely on Citi or Bear's books, but it's not clear, and there is also some mezz debt ($164mm). That put's the new owners' equity at about 8 or 9 % of the purchase price. See the WSJ article for more.
The CMBS loans:
CGM RRI Hotel Portfolio - CD 2007-CD5 and CGCMT 2008-C7, 52 properties, $103mm
RRI Hotel Portfolio - BSCMS 2007-PW17 and BSCMS 2007-PW18, 79 properties, $263mm
UPDATE: Corrected the ownership structure.