Downtown Houston hotel scores $325M CMBS loan

Marriott Marquis Houston gets fresh financing from Goldman, Bank of America

Marriott Marquis in Houston Lands $325M Refinancing
Rida's Ira Mitzner with Houston Marriott Marquis (Rida Development Corporation, Google Maps, Getty)

RIDA Development Corporation scored a major refinancing deal for Houston’s Marriott Marquis Hotel.

The 1,000-key downtown hotel, at 1777 Walker Street, received a $325 million mortgage, according to a Fitch Ratings report. Goldman Sachs and Bank of America originated the loan and packaged it into commercial mortgage-backed securities to be sold off to investors. 

The two-year loan has a floating interest rate. 

The mortgage will be used to refinance $320 million of existing debt and pay $5 million in closing costs. 

The property was appraised at $567 million, putting the loan-to-value ratio at 57 percent. 

RIDA Development Corporation opened the upscale hotel in 2017. Among its amenities is a lazy river in the shape of the state of Texas and a 5,000-square-foot spa. It is also home to Houston’s largest ballroom, which spans 39,300 square feet, and eight food and beverage options. 

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The hotel is connected to the George R. Brown Convention Center via skybridge.  

Between 2019 and 2024, revenue per available room at the hotel increased more than 8 percent. In addition, the hotel is “poised for an uptick in corporate demand,” according to Fitch Ratings. 

The Marriott Marquis’ performance stands out in what has been called the nation’s “worst hotel market.” Houston earned the superlative from TREPP last year due to low occupancy, high delinquency and decreased cash flows. 

A March 2023 TREPP report said the city had more than $1 billion in hospitality loans and a delinquency rate of 43 percent.  

The Marriott Galleria in Houston also resolved for a loss on a $29 million loan last year. Just a few months later, the Crowne Plaza Houston Galleria Area resolved for a loss on a $28 million loan.

Houston-based developer RIDA specializes in convention hotels, like Hilton Orlando, a 1,400-key hotel with access to the Orange County Convention Center. 

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