Axilla Capital Closes $10.7 Million Renovation Loan
for Future Delta by Marriott Kalamazoo Hotel
TROY, MI (December 12, 2017) – Axilla Capital, LLC announced today that it closed a $10.7 million renovation loan for a Delta Hotels by Marriott located in Kalamazoo, Michigan. The loan proceeds were used to fund the property’s gut renovations as well as the addition of an adjacent conference center. Managing Principal Joel Mazur represented the borrower on the transaction.
“The sponsor was working with another national advisory company to secure financing for the project, but they were having difficulty,” says Mazur. “Despite a sensible business plan, it can be difficult for out-of-state developers to obtain financing for any real estate development, let alone hospitality.” Axilla developed a thorough, systematic, approach to the process and garnered interest from a variety of capital sources. It ultimately determined that the best path forward would be through the SBA 504 program, which allows for financing of up to 85% of a project’s costs.
Opened in 1974, the property is currently a 182-room Holiday Inn, featuring a restaurant and lounge, an indoor pool and an arcade and game area. The project also includes the redevelopment of a vacant building located to the southwest of the hotel. Previously a bowling alley, the building’s 29,000 square feet will be converted into upscale conference and event center space. Following the renovations, the property will become part of Marriott’s newest upscale, full-service brand, Delta Hotels, which offers a lean and flexible operating model with a clean and refreshing design.
Located approximately 40 miles east of Lake Michigan, Kalamazoo is well-situated between Chicago to the west and Detroit to the east. The city offers a diverse economic base, including a strong presence by medical, healthcare, and education industries. Two major hospitals, as well as Western Michigan University and other area colleges are important anchors for the Kalamazoo market, and the continued growth within the education sector is a positive trend for the area. The region also benefits from the presence of several Fortune 500 companies, including Stryker Corporation and Pfizer Inc.
About Axilla Capital, LLC
Axilla Capital, LLC is a leading commercial real estate finance and advisory company that specializes in arranging debt, mezzanine and equity capital for hotels, multifamily, office, retail, industrial and self-storage properties. The company’s principals have a combined track record of closing more than $2 billion of transactions. Website: www.axillacapital.com