Vying for a role in the restructuring of well-known luxury resorts in bankruptcy court, an affiliate of the Government of Singapore Investment Corp. is setting the stage for a potential battle with a group including hedge-fund firm Paulson & Co. and Winthrop Realty Trust.
In court papers filed Monday, the Government of Singapore Investment Corp., or GIC, spelled out a $1.48 billion offer it has made to acquire the properties, which include the Claremont Resort and Spa in Berkeley, Calif., and Hawaii’s Grand Wailea Resort Hotel & Spa in Maui.
The sovereign-wealth fund said it already has lined up some $900 million in financing for the deal.
The owners, the Paulson-Winthrop group, haven’t responded to the offer.
“It defies reason” that the resorts haven’t embraced the GIC offer “that would assist them in expeditiously emerging from Chapter 11,” the Singapore wealth fund said in court papers.
The GIC bid would strip control from Paulson-Winthrop, which acquired ownership of the resorts less than a month ago from a Morgan Stanley real-estate fund through a foreclosure proceeding.
That group has said it wants to invest in the properties itself, as has junior debt holder Five Mile Capital Partners LLC.—Eric Morath
Seeking a Solution
In Wine Country
Fort Worth, Texas, developer Crescent Real Estate Holdings LLC is trying to hold on to its marquee resort in California wine country by restructuring and extending a $55 million mortgage.
The securitized loan backing the Fairmont Sonoma Mission Inn & Spa in Sonoma, Calif., was to come due Feb. 1 with the resort worth less than the outstanding balance, according to Realpoint LLC, a debt-analysis company.
But Crescent and the mortgage’s special servicer, Midland Loan Services, are discussing a three-month forbearance deal to allow for more time to hammer out a longer-term extension of the loan, Realpoint says.
Midland reported that the loan restructuring could be completed by May.
Crescent “has indicated their willingness to contribute significant amounts of capital, fund an interest reserve” and make other accommodations, Realpoint says.
Crescent is jointly owned by Barclays Capital and Goff Capital Partners LP.
Many hotel loans are subject to similar restructuring talks. Roughly 14% of securitized mortgages tied to hotels, or $6.2 billion, are now at least 60 days past due, according to Fitch Ratings.—Kris Hudson
On the Horizon: Debt?
Predictions of the commercial-mortgage-backed-securities market’s return are rising by the month.
In a survey of top figures in the lending market that is slated for release Wednesday, real-estate firm Jones Lang LaSalle Inc. says one-fifth of respondents now say that issuance of CMBS, bundled-together mortgages sold as bonds to investors, will top $50 billion in the U.S. this year.
Predictions were generally more restrained at the start of the year. A January survey by Commercial Mortgage Alert found just one of 12 top CMBS executives thought the market would top $50 billion. Now, a flurry of deals in the past six weeks, with more to come, appears to be building optimism.
Of course, while lenders may be optimistic and the number of issuers is increasing, the same cannot be said about investors buying the bonds. Just three firms have dominated the market for the riskiest slices of the CMBS deals. Such a small universe gives those buyers the upper hand when banks are trying to sell their loans.
“They are active, but they’re also pretty picky,” said Tom Fish, an executive managing director at Jones Lang LaSalle.—Eliot Brown