Key information
- SectorHospitality
- TypeSenior mezzanine loan
- StrategyDirect lending
- Websitehttps://moxytimessquare.com/
2021
Year of investment
3-year term
Tenure of loan
United States
Geography
About
Moxy Hotel is a vibrant hotel brand designed for the modern traveller, combining stylish design with affordability. Positioned in key urban locations, Moxy aims to provide an energetic atmosphere with a focus on social experiences.
Why we invested
We invested in the development of a Moxy Hotel due to the opportunity it presents for low leverage financing, specifically at 61% loan to cost. In the context of a challenging hotel market - where 12 months post-COVID 20% of existing hotels in New York were anticipated to close due to new local regulations restricting supply - Moxy offered a compelling risk-return profile.
Value creation
The investment in Moxy Hotel not only captures the resurgence of the hospitality sector but also features a loan tenure of three years with the option for two one-year extensions, providing flexibility for future growth. The hotel provided an attractive risk/return opportunity given the low leverage and a coupon rate of SOFR + 1,350 basis points.
Sustainability
Investing in the Moxy Hotel aligns with sustainable development principles, as it supports an experienced developer and operator in launching a new property amid market disruptions. This initiative contributes to revitalising the local economy while adhering to sustainable operational practices.
The information provided herein is only for professional clients. The case study provided is only for illustrative purpose and is not a recommendation to buy or sell any financial instruments or adopt a specific investment strategy.
Investments with similar characteristics, as well as their past performance may not be repeated in the future. Each asset class have specific risks. Investments in private assets involve a higher degree of risk than more traditional investments. The case study may have been chosen for a variety of reasons, such as being representative of the investment capabilities of the investment team. The circumstances presented are unique to each deal. They do not represent a full picture of the investments made by their respective team and of the product(s) that invested into the asset(s) presented in the case study.