In the wake of the pandemic-induced slowdown, the hospitality industry faced unprecedented challenges. Amid these uncertain times, RRA Capital stepped in to provide funding for one such property: A limited-service Holiday Inn Express & Suites, located conveniently close to Jacksonville's Mayo Clinic campus, undergoing a massive $300 million expansion.

Built-in 2002, the Holiday Inn Express & Suites boasts 104 rooms spread across five floors, nestled on a sprawling 2.06-acre site. Its strategic location makes it the nearest off-campus hotel to the renowned Mayo Clinic, adding significant value to its offerings.  

The hospitality sector in Jacksonville faced a severe downturn during the peak of the pandemic. However, the growing prominence of the Mayo Clinic expansion presents a promising outlook for the hotel's future demand.

RRA Capital secured a non-recourse, 30-month, interest-only loan of $8.7 million. This funding refinanced the existing loan and established an interest reserve to bolster cash flow during the recovery phase. Furthermore, the loan features two 12-month extension options, ensuring flexibility and adaptability.  

Drawing from experience in the hospitality industry, RRA facilitated a seamless financing process, creating a lower leverage loan structure. This allowed equity investors to contribute over $4.0 million in fresh equity, bridging the gap between existing debt and RRA's financing.

The strategic cross-collateralization and cross-defaulting of the Holiday Inn Express & Suites with the Hampton Inn in Jacksonville served as an effective risk mitigation strategy. RRA Capital's thorough approach has safeguarded the interests of both the hotel and investors.

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