Profession Money Broker will implement a successful strategy to build your new hotel.
Hotel development is viable again in gateway cities and select smaller markets. There has been limited new supply since 2009, along with a strong recovery in ADR and occupancy. However, opening a new hotel in the current lending environment is still filled with many challenges.
The most active lenders are local, relationship-oriented banks who often originate through the SBA 504 program. For loans greater than $5 million, there are regional and national players coming back to this segment. Non-recourse construction financing is also available for select projects with above-average development yields.
Developers today are confronted with larger equity requirements. We can assist in filling these gaps by extracting key money from franchisors or arranging subordinate financing. In certain instances, a higher leverage bridge loan may be a preferable solution. Also, we are refinancing many recently-built hotels with non-recourse debt, which can return equity and free up personal guaranty capacity.
We are selectively placing construction financing, and we will take on projects with the following:
- Experienced hotel developers / operators with a proven track record
- Major brands in primary and secondary markets nationwide
- Sponsorship cash liquidity post-closing of 10-20% of loan amount
- Appreciated land contribution