Consolidated Joint Venture Preferred Equity/Capital

12 Months Ended

Dec. 31, 2015

Hotel Development [Abstract]

Hotel Development

Consolidated Joint Venture Preferred Equity/Capital

Our joint venture that developed The Knickerbocker raised $45 million through the sale of redeemable preferred equity/capital under the EB-5 immigrant investor program. The purchasers receive a 3.25% current annual return (which increases to 8% if we do not redeem this equity interest before the fifth anniversary of its issuance), plus a 0.25% non-compounding annual return payable at redemption. The venture received $42.0 million in gross proceeds ($41.4 million net of issuance costs) in 2014 and $1.8 million during the year ended December 31, 2015. The venture will receive the remaining $1.2 million as investors’ visas are approved. We used our 95% share of the proceeds to repay funds borrowed under our line of credit (which were used to fund the redevelopment).