Walker & Dunlop, Inc. has secured a $112.5-million loan to refinance Ace Hotel Brooklyn, according to an announcement released by the firm. The financing relates to the 13-story hotel located at 252 Schermerhorn Street. The property spans 154,947 square feet and includes 287 guestrooms.
The refinancing was arranged by Walker & Dunlop Capital Markets Institutional Advisory on behalf of an affiliate of GFI Capital Resources Group, Inc. and Spruce Capital Partners. The leasehold bridge loan was provided by Torchlight Investors. Aaron Appel, Jonathan Schwartz, Adam Schwartz, Keith Kurland, Dustin Stolly, Michael Brown, Sean Bastian and Cole Grims arranged the transaction. Proceeds from the loan will be used to retire existing senior debt and preferred equity, including financing provided by Corten Real Estate, and to cover closing and financing costs.
Jay Morrow and Carter Gradwell of Walker & Dunlop Hospitality worked alongside the Capital Markets team to advise GFI Capital Resources Group, Inc. and Spruce Capital Partners throughout the process.
Ace Hotel Brooklyn is located at the intersection of Fort Greene, Boerum Hill and Downtown Brooklyn. The property has access to six subway lines, providing connectivity to Midtown Manhattan within 30 minutes. The surrounding area includes the Brooklyn Academy of Music, Barclays Center and nearby retail corridors in Boerum Hill and Brooklyn Heights.
“New York City remains the most supply-constrained hotel market in the country, driven by significant regulatory barriers including the Safe Hotels Act, zoning amendments requiring special use permits, and Local Law 18, which restricts short-term rentals,” said Brown, managing director at Walker & Dunlop. “These factors have limited new hotel development, reduced existing supply, while tourism demand continues to surge, with more than 64 million visitors expected in 2025. We are pleased to support and arrange this transaction alongside our valued partners at GFI Development, Spruce Capital Partners, and Torchlight.”
The hotel includes food and beverage and event operations such as Lele’s Roman and Koju, a Japanese omakase concept. The property also features three fully leased ground-floor retail spaces occupied by Black Seed Bagels, Take Me With You and Finer Sounds. Additional amenities include event space, a ballroom and a fitness center.
“New York is one of the most desirable hospitality markets in the country and is positioned for continued outsized year-over-year growth. Among the Top 25 lodging markets, New York ranks second nationally in RevPAR growth,” said Stan Spiegelman, COO at GFI. “The refinancing of Ace Brooklyn positions the hotel and our investors to continue capturing the exceptional growth potential we see across New York City. GFI’s core investment thesis for the coming years is grounded in our conviction in the continued strength of the New York City hospitality markets, which remain a key focus of our capital deployment. The market is benefiting from a rare convergence of strong macroeconomic tailwinds, sustained expansion within Brooklyn’s hospitality sector, and best-in-class execution by the team at Ace Hotel Brooklyn. We are grateful to Walker & Dunlop for their partnership and support in successfully bringing this transaction across the finish line.”
Walker & Dunlop reported that in 2024 its Capital Markets team sourced more than $16 billion from non-Agency capital providers. The firm stated that this activity reflects its advisory role across multiple asset classes for developers, owners and operators.