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KHP Capital secures $68M refinancing on Kimpton Gray hotel
The loan for the Loop hotel is PNC Bank’s biggest in Cook County this year
Hotel real estate private equity firm KHP Capital Partners refinanced its debt on the Kimpton Gray hotel with a $68 million loan.
PNC Bank provided the loan for the 281-key property at 39 South LaSalle Street, according to Cook County property records.
The loan is the bank’s biggest in Cook County this year. PNC also provided a $65 million mortgage earlier this year to CA Ventures and White Oak Realty for the redevelopment of the Father & Son Plaza on the North Side.
In 2014, San Francisco-based KHP said it planned to spend $106 million to acquire the vintage office building from Itasca-based Hamilton Partners and converting it into the boutique hotel. It would use $14.6 million of historic tax credits to cover part of the cost, Crain’s reported at the time.
Chicago-area hotels are staying busy, even with a multiplying field of competitors. The region’s occupancy rate nudged up during the 12-month period ending in June, according to Marcus & Millichap.
A couple of blocks down from the Kimpton Gray hotel, Prime Group is embarking on a $93 million effort to convert the top five floors of the downtown hotel building at 208 South LaSalle, shifting from office space to a separate boutique canopy hotel.