Credit Suisse is securitizing a $235 million commercial mortgage that is secured by the Shutters on the Beach and the Casa del Mar, two luxury hotels located in Santa Monica, California.

The bonds will be issued from CSMC Trust 2015-SAND. Morningstar and Standard & Poor’s assigned preliminary ratings of ‘AAA’/ ‘AAA’ to $79.6 million of class A notes; ‘AA’/ ‘AA-’ ratings to $28.8 million of class B notes; ‘A-’/ ‘A-’ratings to $21.4 million of class C notes; ‘BBB’/ ‘BBB-’ ratings to $28.3 million of class D notes; ‘BB-’/ ‘BB-’  ratings to $44.6 million of class E notes and ‘B-’ / ‘B-’ ratings to $35 million of class F notes.

The sponsors for this loan are Edward and Thomas Slatkin, who own and manage the hotel via the Edward Thomas Hospitality Corp. The Slatkins have invested approximately $32.7 million to upgrade and maintain the properties from 2008 through May 2015.

The mortgage has an initial term of two years and allows for five one-year extension options; it pays only interest and no principal for the entire term.

Shutters on the Beach was constructed in 1993 and has 198 guestrooms, three food and beverage outlets, 8,920 square feet of meeting space and a four-level below-ground parking garage.

Its sister property, the Casa del Mar Hotel, is eight stories tall and was originally constructed in 1925. The hotel was formerly a beach club and underwent a major $60 million renovation before re-opening in 1999. Casa del Mar has 129 guestrooms, one restaurant and a lobby lounge, plus 8,200 square feet of meeting space.

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