Kolter nabs construction loan for Delray hotel

Kolter Group just closed on a $27.3 million construction loan for a new hotel in Delray Beach.

Property records show Kolter affiliate DK Delray Downtown LLC is building the four-story, 150-room hotel at 135, 145, 169, and 185 Southeast Sixth Avenue. PNC Bank is the lender.

The West Palm Beach-based development and investment firm paid about $2.9 million for the development site in 2016. It plans to break ground early next year and open the hotel by the third quarter of 2019, according to a spokesperson.

Earlier this year, a massive mixed-use development in downtown Delray finally won city approval after eight years in design and review. The $250 million project, called Atlantic Crossing, will bring 343 residential units along with 86,000 square feet of office space and 76,000 square feet of ground-floor spaces for retail stores and restaurants to Atlantic Avenue.

Kolter’s hotel will be about two blocks south of Atlantic Crossing. Scott Webb, president of Kolter Hospitality, said the company chose to build a hotel on the site because of its location and views of the ocean and Intracoastal Waterway.

The developer’s hospitality arm has four projects under development in Florida, including a Hyatt Centric in Fort Lauderdale and Alton in Palm Beach Gardens, according to its website. The Hyatt Centric will be part of Kolter’s 100 Las Olas mixed-use tower in downtown Fort Lauderdale. It will have 238 hotel rooms and 121 condos.