Hotel financing is not one of the most common business propositions in the world, but it’s extremely important to at least a narrow segment of entrepreneurs, for whom it may be the entire focus of their business.
Here are some possibilities for hotel financing which the general public may be unaware of, but which people familiar with the industry understand.
Types of hotel financing
Hotel financing is a broad category which can include refinancing existing debt for an establishment, funding the acquisition of a new hotel, buying out a business partner, renovating the hotel, or possibly even resolving a bankruptcy proceeding. Private monies which are used to finance these kinds of efforts can be arranged through mezzanine loans or bridge loans, equity investments, or through the direct acquisition of a current promissory note.
Which hotels to invest in
Every hotel investment opportunity must be considered on its own merit, and from the perspective of a number of different factors which will contribute to its long-term success. Specifically, an ideal hotel investment opportunity should be one in a location which is not over-saturated with other hotels, and which is situated close to convention centers and airports. This makes these hotels somewhat immune to economic downturns, and makes them much more attractive to lenders and investors.
Bridge loans for hotel financing
Hotel bridge loans will frequently include capital earmarked for renovations or some kind of process improvement plan. It also happens often that the hotel bridge loans will be of shorter duration than other types of loans, generally less than 36 months, and may carry personal guarantees, with closing windows that are shorter than for other types of loans. In the business world of hotel financing, borrowers benefit greatly by working with investors and private lenders, because arrangements can be structured in ways that banks simply cannot manage, due to regulatory constraints.
Hotel financing with Skybridge Capital Group
if your hotel financing project includes features which can’t be handled by traditional lending institutions like banks, contact us at Skybridge Capital Group. We can be more flexible than banks, and we may be able to provide a solution to your financing project.