NorthStar Real Estate Income II, Inc. (NorthStar Income II) announced yesterday that it has completed a $75 million senior loan secured by a Hilton hotel in Dallas, Texas. The 500-room hotel is located within Lincoln Centre office complex and totals 452,000 square feet. It is managed by an affiliate of Hilton Hotels & Resorts.
NothStar Income II initially originated a $70 million pari passu participation interest in the loan, and later purchased the $5 million interest, at cost, from an affiliate of its sponsor, NorthStar Realty Finance Corp. NorthStar Income II used proceeds from its ongoing IPO to fund the senior loan along with an advance under its secured credit facility with Citibank.
“This transaction demonstrates our continued execution of our core business plan to originate well-structured loans secured by high quality real estate that we can prudently finance to generate attractive returns for our shareholders,” commented Daniel R. Gilbert, chief executive officer and president.
He continued, “The strength of our in-house origination platform, our real estate and structuring expertise and flexible financing sources should continue to allow us to build a high quality portfolio and to invest our capital effectively.”
The non-traded corporation intends to qualify as a REIT and originates, acquires and asset manages a diversified portfolio of commercial real estate debt, securities and other select equity investments. As of April 14, 2014, NorthStar Income II’s portfolio consisted of three senior mortgage loans with a combined principal balance of $139.7 million.