Crowne Plaza Hotel at LGA, New York, NY

Opportunistic | Crowne Plaza LGA Airport & Holiday Inn JFK Airport

Transaction Summary

Brickman purchased a subordinate interest in two tax-exempt bond issues (then in default) for $65mm, a 25% discount to par value. The bonds were collateralized by the Crowne Plaza LaGuardia, a 7-story hotel with 358 rooms and 12,500 square feet of meeting room space, and the JFK Holiday Inn, a 12-story hotel with 360 rooms and 6,334 square feet of meeting room space.

Both hotels are in key locations situated near LaGuardia International Airport and John F. Kennedy International Airport respectively. The Crowne Plaza LaGuardia was built in an in-fill location. Both properties suffered from severe mismanagement, and a need for significant capital improvements.

Investment Strategy

Brickman's investment strategy was to purchase the tax-exempt bonds and pursue a foreclosure with the intent of gaining control of the hotels.

Performance Overview

Brickman initiated and successfully completed a foreclosure and a workout plan.

Brickman was paid off by the Borrower at par on the bonds backed by the Crowne Plaza, and Brickman sold the Holiday Inn through the court which also resulted in a pay off at par on those bonds.

Brickman was able to achieve over a 30% IRR and 2.0x multiple over a 2 year period for its investors.