Trinity and Credit Suisse Land $575M to Refi Diplomat Resort in South Florida
By Julia Echikson May 31, 2024 1:44 pm
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Trinity Real Estate Investments and Credit Suisse (CS) are closing in on $575 million to refinance the Diplomat Beach Resort in Hollywood, Fla., nearly two years after purchasing the oceanfront property in a record transaction.
Citi Real Estate Funding and German American Capital are set to provide a $452 million nonrecourse, first-lien loan, according to a report by Kroll Bond Rating Agency. The mortgage, which is scheduled to close June 6, will require monthly interest-only payments and has a two-year initial term with three 12-month extension options.
The Diplomat owners also secured a $123 million mezzanine loan from entities named TD Miami Beach Mezz LLC and PPIB Credit Investments III. That mortgage and $48 million in cash from Trinity and Credit Suisse will go toward refinancing the existing debt and to fund reserves.
Two years ago, Trinity and the asset management arm of Credit Suisse purchased the 12-acre oceanfront resort for $835 million — which was one of the largest hospitality sales in the country since the pandemic. The duo assumed the seller’s $560 million debt, which included a $460 million senior CMBS mortgage and a $100 million mezzanine loan from Morgan Stanley, J.P. Morgan Chase, Wells Fargo and National Association.
Located at 3555 South Ocean Drive, The Diplomat’s main 39-story building houses 1,000 hotel rooms as well as 128,300 square feet of indoor meeting and event space. A sky bridge connects a mixed-use complex across the street that contains two buildings, housing an eight-story parking garage with 1,507 spaces and 52,000 square feet of retail space.
Trinity and Credit plan to invest $36 million to renovate the complex, according to the Kroll Bond Rating Agency. The works are expected to be completed in February 2026.
Last year, the owners also sold development parcels surrounding the property in transactions totaling $52 million to Related Group, Miami’s largest condo developer, and BH Group. The joint venture plans to build a 38-story development with 350 condos and a 43-story condo-hotel with 500 rooms.
A representative for Trinity did not immediately respond to a request for comment.
Julia Echikson can be reached at jechikson@commercialobserver.com.
