Private credit and special opportunities alternative investment manager Atalaya Capital Management has closed a $250m senior construction loan and a $65m preferred equity investment for Flag Luxury Group’s construction and development of The Ritz-Carlton’s new flagship hotel in New York City.
Flag has already developed several hotels and resorts, including four Ritz-Carlton properties in Florida and the latest project will be its first ground-up hotel construction in New York City.
Located at the corner of 28th Street and Broadway in Manhattan’s NoMad neighbourhood, the property is being constructed by Lendlease and has been designed by architect Rafael Viñoly, in collaboration with interior design firm Yabu Pushelberg.
After completion, the new Ritz-Carlton is expected to be the prize hotel for Marriott in New York City, standing more than 550ft tall, with a total of 266-keys, including 16 branded residences, 6,000ft² of meeting space, and a modern food and beverage programme.
The project is expected to be completed in late 2021.
Flag Luxury Group’s Paul Kanavos said: “We are excited to be working with Atalaya, who worked diligently to structure a creative and comprehensive capital solution to facilitate the development of an iconic brand’s new flagship New York City location.”
Atalaya has also partnered with CapitalSource, a division of Pacific Western Bank, in closing the construction loan component of the transaction.
Atalaya Capital Management head of real estate Young Kwon said: “Flag’s success and experience in luxury hospitality development speaks for itself. We also value CapitalSource’s partnership to complete this multifaceted transaction.”
New York City-based Atalaya focuses on making credit and special situation investments in three asset classes – real estate, corporate and specialty finance.
Flag Luxury Group, also based in New York City, is a real estate development company that focuses primarily on luxury hotels and residences as well as land-based entertainment and retail projects.
CapitalSource is a division of Los Angeles-based Pacific Western Bank. Its Construction Real Estate Finance Group structures end-to-end construction financing solutions for major property types, including condo, hotel, industrial, multi-family, office or retail projects.
Image: The Ritz-Carlton, Washington, D.C. Photo: courtesy of AgnosticPreachersKid / Wikipedia.