Tag Archives: Karlin Real Estate

Karlin Real Estate Funds $96 Million in Senior Debt

In two separate financings, Karlin Real Estate has funded $96 million in first mortgage debt to refinance resort properties in Arizona and Colorado.

Karlin Real Estate has provided affiliates of IMH Financial Corporation (IMH) with $50 million in senior debt to refinance the L’Auberge de Sedona (L’Auberge) and the Orchards Inn, two adjacent hotel properties in Sedona, Arizona.

The financing will be used to pay off the existing debt and fund various capital improvements.

“We are excited to work with Karlin as our new senior lender on these assets,” said Lawrence D. Bain, Chairman and CEO of IMH.  “We found that the Karlin team brought a diverse skill set to the table with a comprehensive approach to its analysis that is unique to the investment community.”

L’ Auberge is an AAA Four Diamond luxury inn and spa.  Situated on an 11-acre unique site, the resort property includes an award-winning restaurant, spa, salt and mineral based pool and 18,000 square feet of indoor and outdoor meeting space. L’ Auberge is considered to be one of the most beautiful hotels in the world, and has received countless awards and accolades from hospitality organizations and media. The Orchards Inn is a 70-room hotel located immediately adjacent to L’Auberge. IMH plans to utilize proceeds from the loan to perform certain capital improvements at L’Auberge and Taos Cantina, a 144-seat restaurant under common IMH ownership with the Orchards Inn.

“Both properties are demonstrating increasingly strong fundamentals in occupancy as well as ADR and are well positioned to take advantage of the recovering lodging market,” said Larry Grantham, Karlin Managing Director. “Our financing and IMH’s continued focus on hotel operations will further L’Auberge’s standing as one of the premier resort destinations in Sedona and the Southwest.”

Karlin Real Estate also has provided Grand Heritage Hotel Group (GHHG) with a $46 million senior loan secured by The Historic Stanley Hotel, a 140-key resort property in Estes Park, CO.

Built in 1909 by Freelan Oscar Stanley, co-inventor of the Stanley Steamer, The Stanley is listed on the National Register of Historic Places and is a member of Historic Hotels of America.  In 2010, Grand Heritage completed a multimillion-dollar renovation and restoration program that included restoration of the Concert Hall and manor house referred to as The Lodge.

In addition to refinancing the existing debt on the hotel, Karlin’s five-year interest only financing features a delayed draw component which will be used by GHHG to fund the completion of a new 50,000 sq. ft. luxury lodging building adjacent to The Stanley Hotel under a new brand roll-out called Aspire Hotels and Resorts.  The 50-key building will provide a luxury hospitality component to a proposed 15,000-square-foot, state-of-the-art wellness center being developed by Estes Park Medical Center and the University of Colorado in a unique public-private partnership.  Under the partnership GHHG will provide an array of hospitality services including developing a healthy cuisine restaurant and resort amenities to compliment the cutting-edge wellness and sports medicine services being offered through the wellness center.

“Karlin was able to step in quickly and structure a financing package that allows us to roll-out our new Aspire brand and pursue other unique health, wellness and sport related projects around the world,” said John W. Cullen, President of GHHG.

Grand Heritage will also use a portion of the loan proceeds to acquire Peñasco Del Sol Resort and Conference Center, a 208-key beachfront hotel located in Puerto Peñasco, Mexico.  Grand Heritage had managed the property since 2010.

“Our financing allowed Grand Heritage to take a big first step on what we believe to be an exciting growth strategy,” said Michael Hurst, Karlin Managing Director.  “We look forward to continuing to build upon the strategic relationship with Grand Heritage over the long-term.”

Mill & Rio Salado Rendering, DWC

Hayden House Tempe plans $200M mixed-use project

Cassidy Turley has announced that Hayden House Tempe, LLC, a partnership between San Diego-based Douglas Wilson Companies (Douglas Wilson, Chairman and CEO), Hensel Phelps Development LLC, a subsidiary of Hensel Phelps based in Greeley, CO, (Jeff Wenaas, President) and Los Angeles-based Karlin Real Estate closed on 2.51 acres at the southwest corner Mill Avenue and Rio Salado Parkway in Tempe for $16,875,000. Karlin Real Estate also provided the debt in this transaction. The site is home to Hayden House, the oldest continuously occupied structure in Metropolitan Phoenix and Arizona, built 1871-1873.

Cassidy Turley Executive Managing Director Brent Moser, Vice President Mike Sutton and Associate Brooks Griffith negotiated the transaction on behalf of the seller, Michael Monti’s Catering.

The partnership, Hayden House Tempe, LLC plan to develop Mill & Rio Salado, a $200 million mixed-use creative office and lifestyle-hotel development located on the 2.51 acre parcel widely considered to be the gateway to Tempe’s downtown core. This landmark project consists of a two towers: a 15-story 280,000 square foot Class A office building and a 16-story 274-key Kimpton hotel along with 17,000 square feet of complimentary restaurants and retail.

Historic Hayden House

Historic Hayden House

“Tempe is experiencing tremendous investment and revitalization. This environment combined with the Partnership’s ability to deliver a high-quality, urban mixed-use development will ensure this is a landmark project for downtown Tempe,” stated Douglas Wilson, Chairman/CEO of Douglas Wilson Companies.

Hensel Phelps has been selected as the contractor for Mill & Rio Salado. Construction is expected to start in mid-2015 with completion in 2017. Jerry Noble, Patrick Devine and Greg Mayer with Cushman & Wakefield have been awarded the leasing assignment for the office space at Mill & Rio Salado.

The historic Hayden House, one of Arizona’s original homesteads, will be preserved and repurposed as a destination restaurant to serve the Valley and the surrounding office and hotel guests. The building evolved from a typical Sonoran row house that was Charles Hayden’s family home until 1889, to a boarding house and eventually a restaurant that has been operating continuously in the building since 1924.

Carl Hayden, an Arizona Representative and Senator, was born in the home in 1877. Historians have labeled Carl Hayden “the most important person in Arizona history.” Leonard Monti purchased the property in 1954, and the restaurant, at the time known as La Casa Vieja, was renamed Monti’s La Casa Vieja. The restaurant underwent several additions to the original historic structure.

“The sale and subsequent development of the Mill & Rio Salado site is symbolic of the Tempe transformation into a destination for both corporate and high-tech companies as well as a vibrant lifestyle and entertainment district,” said Mr. Moser with Cassidy Turley.

North Tempe has emerged as one of the most desirable submarkets in the Valley.  It boasts the lowest vacancy rates in Metro Phoenix, with a Class A Vacancy rate under 5%.  It is home to several large office users in multiple industries.  Real estate leaders cite access to ASU, Light rail, freeways, walk able amenities, and true Class A office space as the leading reasons Tempe is experiencing such dynamic attention from office tenants.

The Mill & Rio Salado site is located less than a block from Phoenix’s acclaimed light rail system, across the street from Tempe Beach Park and Tempe Town Lake.  The development will compliment the core of over 3 million square feet of Class A office in Downtown Tempe that has become a magnet for the technology industry due to its central location within the Phoenix Valley and its close proximity to Phoenix Sky Harbor Airport and Arizona State University.

Denver-based Shear Adkins Rockmore Architects (SARA) and historic preservation specialist Nore Winter of Boulder, Co. have been chosen as designers and architects on the project. Both have worked with DWC previously on other projects, including the Symphony Towers in San Diego that also had a historic preservation aspect to the property.

“Because of Hayden House and the requirements with the historic preservation, both SARA and Winter have been working with DWC and their partners as their input was important to putting the sale together and getting all city/municipal approvals,” says a Cassidy Turley spokeswoman.


Karlin Real Estate Sells Scottsdale Neighborhood Center for $44.5M

Cassidy Turley announced the completed the sale of Shea Scottsdale to an entity formed by Jerry Simms for $44.5M. Shea Scottsdale, 10653 N. Scottsdale Road, is a 160,228 SF retail center anchored by Safeway and CVS Pharmacy. The seller was Karlin Real Estate, based in Los Angeles.

Executive Managing Directors Michael Hackett and Ryan Schubert with Cassidy Turley Capital Markets Group represented Karlin Real Estate. Marty DeRito with DeRito Partners assisted the buyer.

“Shea Scottsdale is one of the premier neighborhood centers in the Southwest,” Mr. Hackett said. “The buyer saw tremendous value in the stability and long term growth available in purchasing an asset of this quality.”

The center was built in 1994 and was 95% leased at the time of sale. The transaction included all in-line space as well as additional pads with freestanding structures, including Wells Fargo, McDonalds, MidFirst Bank, Jason’s Deli and Arby’s.

Mr. Hackett and Mr. Schubert sold Shea Scottsdale and an adjacent 117,025 SF retail center Shea Scottsdale East, 7366 E. Shea Boulevard, to Karlin Real Estate in October 2011 for $50.32M. At that time the two centers had a combined overall occupancy of 85%. Karlin Real Estate has retained ownership of Shea Scottsdale East.