Hilton Americas Houston

SAG was the financial advisor to the City of Houston regarding the financing of a hotel under a tax exempt structure through a special purpose tax-exempt entity. SAG led the transaction process addressing such issues as creating the non-profit entity, development team selection, bond structuring, cash flow modeling, rating agency and bond insurer presentations, and contract negotiations. SAG worked closely with the legal team and represented the owner on transaction documents, including the qualified management agreement, technical services agreement, operator loan (key money), pre-opening agreement, room block agreement, official statement, trust indenture, and other transaction related agreements. The bonds were supported by hotel profits and a rebate of the city and state hotel taxes generated by the hotel. The city-wide hotel tax allocated to the City provided a credit enhanced to the transaction.

SAG provided pre-development management services for the development of the 1,203-room Hilton Americas-Houston convention center headquarter hotel adjacent to the George R. Brown Convention Center in Houston, TX. SAG led a multi-faceted team assisting the City with creating the development and financing strategy, establishing a non-profit corporation to facilitate financing and operations, preparing the financial models, selecting the most appropriate project delivery method, writing RFQ/RFP’s for other team members (architect, developer, operator) and basically playing the quarterback role until the developer was hired. SAG’s role continued as owner’s representative throughout the construction process. The hotel opened in 2003 under Hilton management. ¬†SAG was named the new asset manager in 2014.

Project Components: 1,203-room Convention Hotel
Project Value: $285 million