Historic Denver Hose Building No. 1 Part of $69M Hotel Project
Denver, CO – CBRE Hotels announced that it has arranged a $69.0 million construction loan for the development of a 12-story, Hilton Garden Inn in Denver, Colorado. The hotel, located at 20th street and Chestnut Place, adjacent to Denver’s Union Station, is being built around the historic Denver Hose Company No. 1 building, which will be restored and incorporated into the hotel.
Marc Sallette, David Treadwell, Mike Cantwell and Olga Lepow, with CBRE Hotels’ Debt & Structured Finance teams in Houston and Denver, secured the loan on behalf of the borrower, Focus Property Group. The 42-month, fixed and floating rate structured financing included $18.0 million in mezzanine debt as well as $8.0 million in preferred equity. Bank of the Ozarks served as the senior lender, Artemis Real Estate Partners served as the mezzanine lender and EverWest Real Estate Partners served as the preferred equity lender.
“The sponsor’s sought 80% loan-to-cost, non-recourse construction financing, which required a complex transaction with multiple layers,” said Mr. Sallette, senior vice president, CBRE Hotels. “We had to assemble a team of lenders who understood the value this property would bring to the Union Station area and was also able to work within the borrower’s parameters. Our main focus was identifying a solution that would work for all parties involved and I believe we achieved that for everyone.”
“This project was designed to capture the essence of Denver’s rich history while celebrating a new era of economic development,” said Tobias Strohe, Partner at JOHNSON NATHAN STROHE. “Centrally located between Union Station and Coors Field, this hotel embodies the depth of movement from what was once an industrial railyard into a now thriving hub, serving as a gateway to the Central Platte Valley with easy access to I-25.”
The Hilton Garden Inn is designed as an L-shaped tower, balancing the movement and growth of the neighborhood with a strong sense of permanence, anchored by Hose Company No. 1. The light and glassy portion of the tower is treated as a kind of jewel-box to contrast with the heavy walls and historic masonry of the Hose Company. The larger leg of the tower serves as a background to both the Hose Company building and the jewel-box with a perceived heaviness, anchoring it as the gateway into the Central Platte Valley.
JOHNSON NATHAN STROHE is working with design/build partner, Alliance Construction Solutions, as well as engineering firms, SA Miro and MDP Engineering and Kimley-Horn, and landscape firm, Design Workshop.
Focus Property Group specializes in infill development in Denver’s urban core. The company has developed office, retail and self-storage projects in central Denver, including both new construction and adaptive reuse of historic buildings. The Hilton Garden Inn, which will contain 233 guestrooms and will feature banquet and meeting rooms, a fitness center and other hotel amenities, is Focus Property Group’s first hotel project. Davidson Hotels will be the operator.
Rendering by Johnson Nathan Strohe, courtesy of CBRE Hotels