APF, TMGOC Ventures Secure $120m for New Orleans Dual-Branded Hotel
Access Point Financial (APF) and TMGOC Ventures have co-originated $120m in financing to recapitalise a newly completed dual-branded hotel in New Orleans. The project, led by Kailas Companies, involved converting a 31-storey office tower into a 250-room Fairmont and a 216-room Element by Westin, alongside office space and a dining venue.
Major Financing for New Orleans Hospitality Project
Access Point Financial (APF) and TMGOC Ventures jointly provided $120m in bridge financing and preferred equity to recapitalise a recently finished dual-branded hotel in New Orleans, US. The funding was arranged for real estate developer Kailas Companies, which spearheaded the extensive conversion of a 31-storey commercial office building into a mixed-use hospitality asset.
Situated within New Orleans' central business district, the completed property now comprises two distinct hotel brands: a 250-room Fairmont, a luxury marque under Accor, and a 216-room Element by Westin. This development adds significant room inventory to the city's accommodation landscape, catering to diverse traveller segments.
The project also incorporates an Emeril’s Delmonico dining establishment and retains 150,000 square feet of Class A office accommodation, blending commercial and leisure facilities within a single structure.
Kailas Companies' Strategic Redevelopment
The conversion of the high-rise structure into a dual-branded hotel represents a long-term strategic move by Kailas Companies. The developer originally acquired the building in 2014 with the intention of repurposing the asset for hospitality functions.
Initial conversion works on the structure commenced in January 2024, culminating in its recent completion and subsequent recapitalisation. Russ Schildcrout of Ackman-Ziff acted as the broker for this financing transaction, facilitating the arrangement between the lenders and Kailas Companies.
This project highlights a trend in urban redevelopment where older commercial buildings are adapted to meet evolving market demands, particularly in sectors such as hospitality and mixed-use properties, contributing to the revitalisation of city centres.
Investor Confidence in New Orleans Market
Dana Tsakanikas, Chief Investment Officer at APF, commented on the partnership, praising Naveen Kailas and Kailas Companies as an ideal hotel partner with a strong and respected local presence, demonstrating intimate knowledge of the New Orleans market.
Tsakanikas noted Kailas's established track record of 36 years, during which the company has owned and operated a portfolio of office, multifamily, and retail properties within and around New Orleans, accounting for over two million square feet of building space.
APF, established in 2011, functions as a real estate private credit provider, supplying financing solutions to hotel owners and franchisees across the US. The firm shows commitment to the project’s success and maintains its desire to work with partners of Kailas Companies' calibre, reinforcing confidence in the region’s real estate and hospitality sectors.
Implications for Travellers and Industry
This recapitalisation demonstrates robust investor confidence in New Orleans' hospitality market, particularly for large-scale, mixed-use developments. For travellers, the addition of two distinct hotel brands—the luxury Fairmont and the extended-stay focused Element by Westin—provides expanded accommodation choices in the city's central business district.
This caters to both high-end leisure visitors and corporate travellers, potentially increasing competition and service quality. For the industry, the project showcases the viability of converting existing commercial structures into hospitality assets, a model that could be replicated in other urban centres facing similar redevelopment opportunities.
The integration of hotel, dining, and office space also shows a preference for properties that offer diverse revenue streams and cater to multiple user needs, reflecting a broader trend in urban real estate development towards integrated amenities.
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