MANHATTAN -- A new hybrid hospitality-residential chain, combining elements of extended-stay and apartment amenities, will be rolled out in more than 50 locations throughout the Midwest and Southeast, based on a $25 million equity revolver financing secured by AFC Realty Capital.

The equity revolver facility was closed on behalf of a mid-western based real estate development firm, which had built several of the properties, and needed significant capital for a major expansion of its portfolio of "Value Place" properties.

With occupancies as short as a week at rates below extended stay hotels, Value Place properties provide a short-term residential alternative to traditional hotels or extended-stay facilities, while apartment-like features such as kitchenettes elevate living space well above the typical hotel rooms, according to the Manhattan-based real estate investment banking and financial advisory firm.

"The challenge was to find an institutional partner that would provide capital for construction, acquisition, development and working capital funding for relatively small properties costing under $5 million each in mostly secondary locations across a number of different states," notes Paul Fried, an AFC principal, who placed the transaction with an institutional private equity fund.

"The institutional fund provided a facility that could fund as many as 75 properties over the next several years, with the flexibility required for simultaneously building and operating many projects across many markets. The facility gives the developer the financial ability to drive at least $250 million of construction loans.."

AFC Realty Capital is a premier boutique real estate investment banking and financial advisory firm specializing in debt and equity financing, investment, development, and consulting/advisory services. The company has been instrumental, in both a principal and advisory position, for financing, investment and development transactions aggregating in excess of $10 billion.


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