Ashford REIT Puts $98M to Work in Mezz Arena

DALLAS-With mezz lending key to the growth plan, Ashford Hospitality Trust Inc. has spent $98.4 million to secure a stake in a $400-million mezzanine loan tranche for Lightstone Group LLC and Arbor Realty Trust Inc., acquirers of a 687-hotel portfolio in 44 states and Canada. In a press release about the deal, the Dallas-based REIT says its yield is projected to hover 23.9% based on the purchase price discount to par and forward Libor curve through maturity. The loan matures in June 2009, but has three one-year extension options and a wide-open prepayment door. New York City-based Lightstone Group and its partner packaged $6 billion of first mortgage and mezz financing in June 2007 when it bought the portfolio for $8 billion from affiliates of the Blackstone Group, also New York City. Ashford holds a junior loan position to... [read full story]