Sponsor Provides Mezzanine Loan for Renovations in Miami

Terra Capital Partners (TCP), a sponsor of public and private real estate investment related offerings available through independent broker-dealers, recently closed a $16 million mezzanine loan that will refinance and reposition the commercial portion of the 67-story Marquis Tower in Miami, Florida.

The funds provided by TCP’s loan will be used towards renovations including the transformation of the former 56-room hotel on the property into a 129-room hotel. The new hotel, ME Miami, will be operated by Melia Hotels International, an experienced operator based out of Madrid, Spain.

In addition, 10,000 square feet of restaurant and meeting space will be renovated into an STK Rebel steakhouse, managed by The One Group, that will also provide food and beverage services to guests of the hotel.

Miami-based CGI Merchant Group, the borrower, secured all permits and approvals prior to the closing. Terra’s loan plus financing from Prime Finance, replace a $53 million acquisition loan made by Michael Dell’s MSD Capital in January 2014.

“CGI greatly benefited from the institutional flexibility and transactional mindset of the professionals at Terra Capital Partners,” said Raoul Thomas, the CEO of CGI. “The TCP team worked tirelessly as an advocate for the sponsorship amongst the various capital partners in the transaction to ensure a greater degree of execution certainty,” he added.

CGI has borrowed from TCP in the past.

The loan is also collateralized by a 156-space parking garage and two wallscapes leased to Apple and GM. Additionally, the Marquis Tower includes 290 luxury condominiums which are not encumbered by TCP’s loan.

“We are excited to be part of this dynamic hospitality project in one of the fastest growing urban centers in the country,” commented Adam Kies, Managing Director of Terra Capital Partners.

He added, “CGI did a tremendous job in bringing in best-in-class operators at the earliest stage of the project’s conception and enhancing the diverse revenue drivers for this trophy asset.”

TCP announced in April that its registration for a public, non-traded business development company (BDC) was declared effective by the SEC. Terra Income Fund 6, Inc. will invest its offering proceeds in originated or acquired commercial real estate (CRE) loans to U.S. companies secured by high quality CRE.