George Smith Partners Arranges $32M for Hotel Construction

George Smith Partners, Los Angeles, arranged $32.4 million for the ground-up development of IHG Hotel Indigo, a 35-acre resort hotel in Coachella, Calif., for developer Glenroy Coachella.

The property will include a 13,000-square-foot convention center, a 10,000-square-foot salt water pool, an 11-acre space to host music-related events and 250 guestrooms with private entrances.

George Smith Partners Principal and Co-Founder Steve Bram worked with Senior Vice President David Pascale Jr. and Assistant Vice President Huber Bongolan Jr. to arrange a $24.4 million senior construction loan and $8 million in Property Assessed Clean Energy funding for the hotel.

The deal represented the first new construction hotel project ever financed by PACE in California, Bram said.

“In today’s lending environment, hotel construction is a challenge to finance,” Bram said, adding that GSP found a lender who understood and was excited about the concept. “The PACE financing was then added to complete the total capital stack.” The PACE equity, essentially an energy loan, financed the energy-efficient HVAC, lighting, windows, water systems and seismic strengthening.

In addition to the dual capital sources, the City of Coachella provided a $25 million tax abatement and approving bond financing for the infrastructure, Bram said.