Driftwood Capital has provided $35 million in mezzanine financing for the Sheraton Dallas Hotel, which, at 1,841 rooms and more than 230,000 square feet of meeting space, is the largest hotel in Texas.
The financing was issued through Driftwood’s lending fund, Driftwood Lending Partners, LP, and is part of a broader refinancing effort led by a joint venture sponsored by Chartres Lodging Group.
The transaction replaces a 2024 CMBS loan of $270 million with a new $300-million senior loan originated by Goldman Sachs and JPMorgan Chase Bank. Driftwood also increased its mezzanine loan from $30 million to $35 million. The new two-year loan includes three one-year extension options.
“This refinancing strengthens the borrower’s capital structure as group and business travel fuel demand in metro Dallas,” said Scott Melby, vice president of capital markets at Driftwood Capital. “The hotel’s advantageous location, coupled with sustained commercial travel and a recovering convention segment, position the Sheraton Dallas for strong operational performance and long-term value creation.”
The hotel, located at 400 Olive Street, includes five restaurants, 113 meeting rooms and 1,100 parking spaces. It is in Dallas’ City Center District, near several transit connections. Dallas Love Field is about 15 minutes from the property, while Dallas-Fort Worth International Airport is about a 30-minute drive. The DART Pearl/Arts District Station is across from the hotel.
Driftwood Capital’s strategies include hospitality acquisition, development and lending. The firm recently consolidated 18 hospitality assets recapitalized at $1.2 billion, spanning 10 states.
