Kiteville Extended-Stay Portfolio
Kiteville Investment LLC, a Philadelphia-based extended-stay operator founded in 2018 by CEO Budo Bunul, is acquiring 11 limited-service hotels (about 781 units) across Illinois, Indiana, Ohio, Michigan and Pennsylvania and converting them into extended-stay and workforce housing. The business plan is to buy at a basis well below replacement cost (roughly $21K–$23K per unit), renovate, and lease to longer-stay residents whose occupancy is steadier than transient hotel demand.
Kiteville already runs this playbook at scale: 906 units live across 16 properties in 15 markets, operated on its own centralized platform for booking, self check-in, operations and AI-driven pricing. In Owego, New York, Kiteville bought an 80-unit motel for $2.2M, invested about $600K in renovation and, by its own figures, reached stabilized extended-stay occupancy in about seven months at a roughly 49% NOI margin.
This offering funds a $6.62M secured convertible note, about 20% of a ~$33.1M capitalization, sitting behind a $23.17M senior facility and ahead of $3.31M of sponsor cash equity.
The note pays 12% (Year 1 paid-in-kind, quarterly cash thereafter). If the sponsor repays early, the payoff is the greater of 1.40x funded principal or an 18% IRR, plus a 2% exit fee. If the note is not repaid, it converts into 45% of the equity of the funded portfolio.