Following negotiations with its creditor regarding collateralized mortgage agreements secured by the Westin St. Francis hotel in San Francisco and Chicago's Fairmont hotel, real estate investment trust (REIT) Strategic Hotels & Resorts (NYSE: BEE ) announced today that both contracts have been amended.
The new terms of the deals, assuming Strategic Hotels meets "certain financial and other requirements," eliminates future principal amortization payments. Before the contract changes, Strategic Hotels was subject to a 20-year principal amortization schedule, according to the company.
Strategic Hotels said the two amended agreements combined will save it $9.3 million in principal amortization payments in the next calendar year alone, and $37.2 million over the life of the loans. Both loans come due in June 2017 and carry a 6.09% fixed rate. Metropolitan Life Insurance is the lender for both properties.
Strategic Hotels & Resorts owns, or has an ownership interest in, 18 high-end hotel and resort properties in the U.S., Mexico, and Europe, with a total of 8,271 rooms.