Blackstone’s Motel 6 portfolio gets $685M CMBS loan

Goldman Sachs, JPMorgan provide two-year, floating-rate loan

San Francisco /
Sep.September 03, 2021 09:00 AM
G6 Hospitality CEO Rob Palleschi and Motel 6 San Jose South, one of the largest assets in the portfolio (G6)
G6 Hospitality CEO Rob Palleschi and Motel 6 San Jose South, one of the largest assets in the portfolio (G6)

Blackstone is refinancing a portfolio of 106 Motel 6 and Studio 6 hotels across the country.

The firm’s G6 Hospitality secured a $685 million commercial-backed securities loan from Goldman Sachs and JPMorgan to refinance 98 Motel 6 hotels and eight Studio 6 hotels, which offer extended stays, according to a report from S&P Global Ratings.

The two-year, floating-rate CMBS loan will mature in September 2023, the report said. It has two one-year extension options and will be interest only for the entire period.

The CMBS loan, along with a $300 million term loan, will refinance $725 million in prior CMBS and mezzanine loans, pay off $222.8 million in credit facilities and fund $16.8 million in closing costs, according to the report.

Though spread out across 12 states, the majority of the loan will go towards properties in California, including the Motel 6 LAX and Motel 6 in San Jose — the two largest assets in the portfolio.

Around 8 percent of the loan will go to properties in Florida, while 6.7 percent will go to hotels in Arizona.

Though the pandemic has crushed the hotel sector, economy lodging has fared better, given low prices, drive-to locations and lower staffing needs, the report added.

G6 Hospitality last secured financing for Motel 6 hotels in 2017, when it issued over $4 billion in CMBS loans.

Since then, the firm has sold 354 out of its 460 hotels, which were located in “inferior, lower price point markets,” according to S&P Global Ratings.





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