ACRES Provides $37M Bridge Loan for Finger Lakes Resort
ACRES Capital has provided a $37 million bridge loan for the construction of the Canandaigua Finger Lakes Resort at 205 Lakeshore Drive in Canandaigua, New York, Commercial Observer has learned.
The bridge loan—provided to local developers Robert Murphy and David Jenecco—will facilitate the development of the mixed-use waterfront property, which will include a 109-key Tapestry Collection by Hilton hotel as well as 44 residential condominium units.
The property sits in a prime location at the northern end of Lake Canandaigua, which is a popular year-round regional tourist destination drawing from the nearby Rochester, Buffalo and Syracuse markets.
The developers acquired the land in 2012 with a plan to build a boutique hotel as well as condo units, beginning to fund the work with their own equity. The steel structure was built and concrete poured but work on the hotel halted in July 2015 when the previous financing fell through. New prospective lenders were having a tough time wrapping their arms around the project because the hotel component didn’t have a flag at the time, so the developers brought in Hilton’s Tapestry flag.
“We liked the project even when it was in boutique form and going to be locally operated, but the Hilton flag elevated it to a new level,” Mark Fogel, president and CEO of ACRES, told CO.
While ACRES had some competition for the deal, the lender was selected for a few reasons, including its surety of execution, creative financial structuring and strong asset management background, Fogel said. Plus, Marty Reasoner, a managing partner at ACRES, grew up in nearby Rochester and was familiar with the area’s attributes.
“There were local banks that would have done smaller loan amounts on this deal but [not a] $37 million construction loan. A couple of other groups were interested, but with Marty’s connection to the area we had a full understanding of why Canindaigua Lake works from an investment perspective,” Fogel said.
The hotel will have a heavy focus on food and beverage operations. The developers hope to establish it as a wedding venue in addition to drawing visitors from the nearby wineries and fishermen angling at the lake. As such, the property will include a 15,000-square-foot catering hall.
Its amenities are set to include a spa and fitness center.
Speaking generally of hotel financings, Fogel said: “We’re seeing a ton of opportunities on the hotel side of the business, because it seems like the spigot has been turned off a bit with respect to traditional bank financing for hotels and also CMBS for hotels. We’re trying to be really choosy about what we do, so we’re focused on really strong locations and the reason for being in those locations.”