Colliers Finance Team Seeks $70M for Luxury Costa Rica Development [Updated]
Terence Cullen Dec. 7, 2015, 11:30 a.m.
The weather in the Big Apple might be getting chilly, but the New York-based structured finance team at Colliers International is finding a lot of warmth in Central America.
An international joint venture has tapped Colliers Executive Director Jeffrey Donnelly and Director Ulrike Ahrens to raise $70 million in debt and equity for a sprawling project along Costa Rica’s shoreline, Commercial Observer can exclusively report.
The Costa Rican investment firm Aldesa and the Alberta, Canada-based development company Landsvest Capital Group are sponsoring the project, a source familiar with the matter said on the condition of anonymity.
The mega-development will include a 130-key Rosewood hotel, as well as a 250-home gated complex on 902 acres on the oceanfront in Guanacaste, a province that hugs the Pacific Ocean in the northwest region of the country. The luxury residential complex will also feature a golf course designed by golfing legend Jack Nicklaus.
Mr. Donnelly and Ms. Ahrens are seeking $20 million in preferred equity to support a $50 million construction loan that has yet to close. The brokers are also looking to arrange a $50 million senior loan for infrastructure work on roads and homes in the gated community.
Banco Nacional de Costa Rica is the tentative lender on the construction financing, but has not yet committed the debt, the source in the know told CO. That deal is expected to close in roughly three months.
The brokers are looking for either a single partner to provide the remaining $70 million, or to break the debt and equity into two parts. In the second option, equity for the hotel, which includes 54 villas, could either come from a private equity fund or family, according to Mr. Donnelly. A potential lender for the $50 million senior loan, carrying a 45 percent loan-to-value ratio, could include an asset-based lender, he said.
“We also have a better, more convenient, more strategic location than the Four Seasons or the Andaz,” Mr. Donnelly said. “That, coupled with the very strong, institutional sponsorship makes this offering a winner. We are delighted to be handling this exciting resort and residential financing.” He declined to name the project’s sponsors.
Ms. Ahrens said the sponsors’ track records and the project’s prime location make the financing and equity raise a shoo-in for the Colliers team.
“In taking on any financing assignment, we have to emphatically check two boxes,” she said in prepared remarks provided to CO. “First, the project has to be well-conceived, in a supply-constrained market and have good supporting market/feasibility studies. Second, the sponsor has to have a strong track record, strong balance sheet and be a bankable developer. Here, we have that in spades.”
Correction: This article has been updated to reflect the identity of the sponsors seeking the debt, as well as the identity of the construction loan provider. The article previously stated that one of the two sponsors is based in the United States.