Monday, May 10, 2010

"People familiar with the matter"

The Wall Street Journal this morning is quoting "people familiar with the matter" who say that Goldman Sachs is close to a deal to provide $2.2 billion in financing to a group led by Starwood Capital Group, so Starwood can buy the Extended Stay hotel chain.

May 17 -- a week from today -- is the deadline set by the bankruptcy court for acquisition plans from Starwood and/or from another bidder.

The alternative bidder is a group led by Centerbridge Partners LP.

The Wall Street Journal's story, by Lingling Wei, suggests that Goldman's willingness to get involved in this is a good sign that a recovery is underway.

"For months, investors have been gathering huge war chests to buy distressed real estate, but debt financing has been much harder to obtain. Goldman Sach's willingness to finance the Starwood bid is a sign that large well-capitalized banks are dipping their toes back into the business of financing offices, shopping malls, hotels and other commercial buildings."

No comments: