Swartz and Kapahi of HKS arrange $39 million CMBS loan; for the 72-unit Hotel Giraffe in Flatiron

HKS Capital Partners negotiated a $39 million CMBS loan from CCRE for the refinancing of the 72-unit Flatiron boutique Hotel Giraffe on Park Ave. South. The 39-key hotel, part of the Library Hotels Collection, is owned by Henry Kallan. HKS Capital co-founder Jerry Swartz has handled all three permanent mortgage refinances on the hotel done over the past 15 years. Swartz also created the joint venture between the original owner of the property and Kallan to purchase the land at 365 Park Ave. South, before the Flatiron District was a tony neighborhood. He then arranged financing for the demolition of the previous SRO asset and the construction of Giraffe. "Fifteen years ago I knew the area was emerging," said Swartz who helped convince Kallan to build The Hotel Giraffe, one of several that now comprise his mini-empire, The Library Hotel Collection. Kallan's signature property is the Library Hotel, on 37th St. The latest loan is the fourth that Swartz has negotiated for the Giraffe property at East 26th St. The 10-year loan has a 4.3% interest rate. "It makes sense because the rates are low now and the loan was coming due," said Swartz, who also convinced the ownership to take more money out. I convinced them to take more because being able to pull out additional tax-free dollars. It just made sense. There will be a lot of opportunity coming up in the next year or two." HKS Capital's co-partner Ayush Kapahi also worked to negotiate the loan.