A $280 million loan on the Slatkin brothers’ Casa del Mar and Shutters on the Beach was sent to special servicing over a disagreement on an extension stipulation.
The hotelier brothers, Edward and Thomas Slatkin, were “unable to meet the maturity extension conditions” on the loan backing the luxe Santa Monica hotels, servicer commentary via Morningstar Credit indicated.
Thomas Slatkin didn’t deny that, but still doesn’t agree with the move.
“The current matter involves a disagreement regarding one of the loan’s extension provisions. We believe the special servicer has taken an unnecessarily aggressive position, despite the hotels’ strong financial performance and compliance with their obligations under the loan,” he said in a statement to The Real Deal. “We are confident this matter will be resolved promptly.”
Special servicer LNR did not immediately respond to a request for comment.
On top of the commercial mortgage-backed securities debt, there is $120 million of mezzanine debt. The brothers landed the two-year $400 million refinance in the summer of 2024. Citi Real Estate Funding originated the senior loan that was sold off to investors through a commercial mortgage-backed securities deal — and the mezzanine loan was provided by a consortium of funds tied to Goldman Sachs, TRD previously reported.
Thomas Slatkin said that after negotiating the refi, they “have remained current on all loan obligations. Both Shutters on the Beach and Hotel Casa del Mar continue to perform exceptionally well, with particularly strong business over the past six months.”
Casa del Mar has 129 rooms and suites, and Shutters on the Beach has 198; the beachfront hotels are at 1910 Ocean Way and One Pico Boulevard. At the 2024 refinancing, the chic sister hotels received an around $605 million appraisal. That comes out to about $1.9 million per key. Only a handful of California hotels have that price tag — among those was the Surfrider.
Luxury fashion brand Chrome Hearts, owned by Richard and Laurie Stark, purchased the small, oceanfront Malibu hotel from Dauntless Capital Partners for $37.5 million late last year. It was one of California’s priciest per-key deals ever, and the priciest all year, at about $1.9 million a room.
Back to Casa del Mar and Shutters, in early 2025, post-refinancing, the Slatkin brothers explored a capital raise tied to their Santa Monica hotels to develop branded residences on the land next door.
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