A lender group including Paulson & Company has taken over former CNL Hotels & Resorts properties from Morgan Stanley’s real estate funds, Bloomberg reports. The $600 million debt restructuring, which has given the group control of eight luxury resorts, involves the corporate debt used to fund Morgan Stanley’s 2007 purchase of the hotel owner.
Under the terms, $200 million of corporate debt was extinguished and $400 million was converted into equity. Besides the hedge fund, Winthrop Realty Trust, Capital Trust and Morgan Stanley’s special property group are the lenders.
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