When the Community Finance Corp. acquired the Grand Hyatt San Antonio from Hyatt in 2022 for $406 million, it is understood to have been the first transition of a U.S. hotel from balance-sheet ownership to a municipal bond financing structure.
Community Finance Corp. is a nonprofit real estate developer that creates public–private partnerships offering an alternative to traditional finance.
CFC typically participates in the financing and development of prisons, fire stations, police facilities and student housing on behalf of municipalities and state governments, implementing low-interest and tax-exempt bond financing.
The 1,003-room Grand Hyatt San Antonio serves most of the city’s group events and was built in 2008 directly adjacent to the Henry B. Gonzalez Convention Center, which is owned and operated by the City of San Antonio.
The city also owns the land the hotel sits on, and during the pandemic it experienced shortfalls in occupancy tax revenue and ground-lease payments, putting a strain on municipal finances.
When CFC bought the hotel building, which continues to be managed by Hyatt, CHMWarnick was engaged in its capacity as a leading hotel asset manager and owner-advisory firm.
“This wasn’t just about asset managing. It was about safeguarding a public investment and delivering value for bondholders, the City of San Antonio, and the community,” said Dan Walsh, senior vice president of CHMWarnick.
This story originally appeared on Hotel Management's sister site Hospitality Investor.