Peachtree Group Secures $176.5M CPACE Loan for Rio Hotel Renovation in Las Vegas

Dreamscape Companies has secured a $176.5 million CPACE loan from Peachtree Group to fund the comprehensive renovation of the Rio Hotel & Casino in Las Vegas. The deal, finalized in less than 60 days, marks the largest credit transaction in Peachtree's history and one of the most significant CPACE financings in the United States.

The financing allowed Dreamscape to pay off existing senior debt and retroactively cover 100% of the renovation project costs. The Rio's $340 million renovation, completed at the end of 2024, included upgrades to the Ipanema Tower suites, a redesigned casino floor, new HVAC and electrical systems, enhancements to the convention center, improved dining and beverage outlets, and exterior improvements.

“This deal highlights an inflection point for CPACE, with some of the nation's largest financial institutions consenting to its use because they see the clear benefit to the capital stack,” said Jared Schlosser, head of originations and CPACE for Peachtree. “By closing quickly on a marquee hospitality asset, we were able to strengthen the position of both the owner and its lenders.”

Despite the renovation progress, reports suggest financial instability at the Rio, including discussions with lenders about restructuring, a hiring freeze, and unrefurbished hotel towers. Dreamscape owns the property assets, while Caesars Entertainment continues to operate the venue under a sale-leaseback agreement from December 2019.

The Rio joined Hyatt's Destination brand in 2023 as part of its repositioning strategy. Peachtree CEO Greg Friedman called the transaction a milestone, noting that the company has originated more than $1.5 billion in CPACE loans to date.

The CPACE market has expanded dramatically over the past 10 years, with over $10 billion in financing as investors adopt the CPACE structure for energy-efficient and sustainability upgrades. Retroactive funding options allow projects like the Rio to reimburse 100% of completed renovation costs while improving capital flexibility.

This transaction underscores a broader shift, as large financial institutions increasingly recognize the value of CPACE financing in reshaping capital structures for marquee hospitality assets.