Taconic Capital Advisors Nears Default at Jersey City Hotel
Taconic Capital Advisors is out of the commercial real estate game, but that doesn’t mean commercial real estate is done with the firm.
A $100 million commercial mortgage-backed securities loan backed by the Hyatt Regency at 2 Exchange Place in Jersey City was transferred to special servicing, the Commercial Observer reported, citing a Morningstar Credit Analytics report. The reason given for the transfer was imminent maturity default; the debt matures next month.
The 351-key hotel is co-owned by Taconic and HEI Hotels & Resorts, which joined together to purchase the property from Veris Residential and Hyatt Hotels for $117 million in late 2022. That ownership group reportedly stated it would not be able to pay off the loan by next month, though Morningstar reported an extension or forbearance could be worked out.
The debt — originally issued in three loans — dates back a decade. The hotel’s net cash flow met the underwritten debt levels the year the loans were originated, but not again since then. Negative cash flow went negative in 2024 and net income was 68 percent below underwriting projects last year.
The hotel, which opened in 2002, is on the Hudson River Waterfront Walkway and is a short trot from the New Jersey PATH train station. Features of the property include more than 20,000 square feet of event space, a fitness center, a garage and an on-site restaurant.
Taconic did not respond to a request for comment from the publication.
In late 2024, New York-based Taconic began winding down its CRE operation and sold one of its funds to another New York-based operator, Axonic Capital.
Abandoning commercial real estate represented a shift for Taconic towards its core investment strategies of merger arbitrage and corporate and structured credit.
Taconic’s real estate bets were event-driven and relative-value, according to the firm’s website. The company has invested more than $3 billion in direct real estate deals.
Taconic also invested upwards of $5.5 billion of CMBS market value and made more than 175 transactions in commercial real estate. In June 2024, for instance, Taconic and Machine Investment Group landed $90.4 million in C-PACE financing for two Hyatt hotels in Hollywood they acquired through foreclosure.
Read more
Veris sells hotel portfolio as shift to multifamily continues
District Hospitality Partners buys Baltimore hotel for $51M
Taconic Capital Advisors leaving CRE behind
