Minot Hotel Portfolio

Location: Minot, North Dakota

Size: $25,000,000

Challenge: Underwriting

Type: Capital Advisory

As fracking technology caused massive oil exploration, we were hired to arrange acquisition financing for the Holiday Inn Riverside and Holiday Inn Express in Minot.  RevPARs and NOI had increased astronomically in North Dakota, but a wave of new hotel supply was also going to hit.  As difficult as it was to evaluate the supply/demand equation, the Holiday Inn Riverside had been closed for six months due to the Souris River flood, making it impossible to calculate a T-12.  We successfully placed a 65% CMBS loan at 4.6% with 25 year amortization, which our client had been skeptical we could even obtain at all.  When half of their equity fell out at the last minute, we brought in a high net worth investor for mezz and a portion of the equity.