Access Point and TMGOC back New Orleans hotel conversion with $120M

Access Point Financial and TMGOC Ventures co-originated a $120 million bridge loan and preferred equity investment to recapitalize a completed office-to-hotel conversion in downtown New Orleans, IREI reported. The project, developed for Kailas Cos., includes a 250-key Fairmont by Accor. A 216-key Element by Westin shares the building. The property also houses Emeril's Delmonico restaurant and 150,000 square feet of Class A office space. Ackman-Ziff brokered the transaction.

The building began life in 1970 as an office tower designed by Skidmore, Owings & Merrill. It stands 31 stories. Kailas bought it in 2014, with conversion in mind. Construction began in January 2024. The hotel is one block off Canal Street. The French Quarter lies a few blocks to the northeast. Caesars Superdome, Tulane University, and the LSU Health Sciences Center are all within walking distance. That gives the location a demand base of conventions, medical travel, and tourism. The retained office component can offer a steadier cash flow than a hotel's opening months.

The co-originator, TMGOC Ventures, focuses on hospitality and multifamily development and private equity. According to IREI, the firm's team brings more than 150 years of combined experience. TMGOC is taking a direct role in the capital stack. The dual-branded format spreads demand across two established flags under one roof.

The building is converted, but the hotels' income has no track record yet, and permanent lenders will not underwrite that. Bridge debt and preferred equity fill the gap. The sponsors chose this layered capital over selling into a thin market for unseasoned assets. That is the refinancing wall in its current form: extensions and preferred structures rather than forced sales, as this publication has argued. Private capital is absorbing the risk and charging for it. The premium is the market's price for time.