MHI Hospitality Corp., a lodging real estate trust based in Williamsburg, Va., has exercised its option to extend the maturity date by one year on its mortgage loan secured by the Crowne Plaza Hampton Marina Hotel, Hampton, Va.
The loan is for $9 million and is held by TowneBank, a commercial bank located in the Hampton Roads area of Virginia. The new due date is June 30, 2012. The interest rate is Libor plus 455 basis points with an interest rate floor of 5%.
MHI will make monthly principal payments of $16,000 to TowneBank, plus it has pledged cash collateral of $750,000 which will be held in an interest-bearing account. TowneBank may use this cash collateral as principal curtailment in the event certain debt service coverage thresholds are not met by Dec. 20. According to a Securities and Exchange Commission filing, the parties agreed to a minimum debt service coverage ratio of 1.20.
In addition, MHI will pay TowneBank an extension fee of $22,500.
