Dealmaker: Peachtree Group Originates $73M for Construction, CPACE Financing for San Diego Hotel

(Image courtesy of Peachtree Group)

Peachtree Group, Atlanta, announced it originated $73 million in a construction loan and CPACE financing for the development of a 263-room dual-brand Home2 Suites and Tru by Hilton Hotel in San Diego.

It was originated on behalf of Baxter Hotel Group, a San Diego‐based, vertically integrated real estate development and management company. The firm intends to begin construction this month, with a 22-month timeline.

Peachtree originated a $50.4 million floating-rate construction loan over a three-year term and $22.6 million of fixed-rate commercial property clean energy financing amortized over 25 years, which in total represented 64% of the total development cost.

The budget has CPACE-eligible items, including seismic improvements, lighting, building envelope, HVAC, plumbing and qualifying soft costs.

“We were able to execute an innovative capital stack with the addition of CPACE in an otherwise difficult financing market that provided ample capital for the construction to begin while saving the sponsor 200 basis points in interest rate spread,” said Jared Schlosser, Peachtree’s Senior Vice President, Head of Hotel Origination and CPACE.