Trinity, Credit Suisse secure $575M refi for Hollywood’s Diplomat

Trinity Real Estate Investments and Credit Suisse Asset Management lined up a $575 million refinancing of the Diplomat Beach Resort in Hollywood.

The joint venture is expected to close on a $452 million first-lien mortgage from Citi Real Estate Funding and German American Capital Corp. next week, according to a Kroll Bond Rating Agency report. TD Miami Beach Mezz LLC and PPIB Credit Investments III Inc. will also be providing Trinity and Credit Suisse with a $123 million mezzanine loan with an estimated spread of 8.7 percent, the report states. 

The $452 million mortgage is a floating rate loan with an initial term of two-years and interest-only payments, per the report. Honolulu-based Trinity and Stockholm, Switzerland-based Credit Suisse will also have three, one-year extension options. 

Proceeds from the two loans, as well as $48.3 million in equity by Trinity and Credit Suisse, will be used to refinance $560 million of existing debt and fund reserves tied to the Diplomat, the report states. 

In 2022, Trinity, led by CEO Sean Hehir, teamed up with Credit Suisse’s investment arm to buy the 1,000-key oceanfront resort at 3555 Ocean Drive, an adjacent garage complex and two development sites. The joint venture paid $835 million. 

As part of the acquisition, Trinity and Credit Suisse took over a $460 million senior mortgage and a $100 million mezzanine loan, the report states. 

Last year, the joint venture sold the two development sites for a combined $51.5 million to Coconut Grove-based Related Group and Aventura-based BH Group. The deal also included a marina and 62,000 square feet of existing retail space on the ground floor of two interconnected garages known as Diplomat Landings. The development sites and Diplomat Landings are along the Intracoastal Waterway. 

Related and BH are planning a 443-foot-tall hotel with 500 rooms and some condo-hotel units, as well as a 419-foot-tall condominium with 350 units. In March, the joint venture launched sales at the condo project, which will be called Icon Beach Residences.