Malcolm Davies and Zack Streit of The Davies Group at Los Angeles-based George Smith Partners, a premier commercial real estate capital advisory firm, arranged $42.5 million in construction financing for the conversion of a 496-key hotel to a market-rate multifamily complex in Southeast Colorado Springs. The financing was arranged on behalf of Shir Capital and the ValCap Group and provided by Parkview Financial.
“We were particularly attracted to the Colorado Springs location and the property’s very extensive amenities and irreplaceable quality of its construction,” said Richard Fishman, President of the Valcap Group. “Colorado Springs is a wonderful destination for vacationers, and the high quality of its outdoor lifestyle make the property an ideal project. Both existing long-term inhabitants and newcomers to Colorado Springs will find our refashioned Alta Hotel + Living to be a great place to live and stay.”
Occupying 17 acres of land, the project features boutique-style amenities to include 47,000 square feet of ballroom, meeting, and self-storage space (294 public self-storage units averaging 109 square feet each), a restaurant and bar, a state-of-the-art fitness center, indoor and outdoor pools, a sport court, and a convenience store.
Constructed in 1980, the project will undergo a major renovation, with interior and exterior upgrades driving occupancy rates. As a relatively new asset class, the project is one of the largest hotel-to-multifamily conversions in the U.S. and one of the first and few in the Colorado Springs submarket. The adaptive reuse of the former hotel will re-brand the amenity rich apartment complex as a vibrant, new rental option, revitalizing the community.
“Parkview believes in creating affordable and attainable housing in strong markets across the United States. This will be our third hotel to multi-family conversion,” said Paul Rahimian, President and CEO of Parkview Financial. “We believe in the Colorado Springs market and the sponsor’s business plan to provide furnished, affordable housing to potential tenants.”
Led by Principal and Managing Director Malcolm Davies and Senior Vice President Zack Streit at George Smith Partners, The Davies Group was able to identify a lender who recognized the hotel as a prime candidate for the conversion in an ultra-high-growth submarket. “We are incredibly proud to play a part in the success of this unique project and are excited that the project will offer a modern, elevated living experience to the community,” said Streit.
Consistently ranked as one of the best places to live in the United States, Colorado Springs is home to an increasingly large number of young professionals and military personnel. The submarket’s strong fiscal infrastructure is bolstered by nearly thirty Fortune 500 companies and a diverse employment base, with jobs in the aerospace, military / defense, software / IT, life sciences, and tourism industries. The project builds on Colorado Springs’ long term economic growth and its stable source of demand for affordable, high-quality rental product in an area where supply is limited.
Davies and Streit, along with other Davies Group members, Senior Vice Presidents Drew Sandler and Alexander Rossinsky; Vice President Aiden Moran; Assistant Vice President Brandon Asherian; and Analyst Ben Tracy sourced the financing on behalf of the sponsor.