Financing
Strategies, trends and news in the financing of new hotel and resort development, acquisitions and renovations. How to obtain debt and equity for the financing of projects in the lodging industry.
Choice Hotels Reinforces Commitment to Cambria Suites
Choice Hotels says it is fully committed to the growth and success of Cambria Suites, its fledgling upscale all-suites brand. That’s a tall order, given that the brand was hatched at the worst possible time—the first Cambria opened the year before the start of the near-crippling recession—and has only been able to grow to 19 hotels (the latest, a 111-room property in Rapid City, SD, opens today). Still, Choice is putting its considerable ...
CMBS Distress Resolutions Are No Easy Feat
Commercial real estate professionals have always known that resolving distressed CMBS debt situations would be difficult, given the multitude of properties and note holders involved in every deal. A recent debt restructuring completed on the Atlantis Resort and Casino in the Bahamas proves just how tricky CMBS distress resolutions can get....
New Appraisal Method Could Limit Lending
If you‘re not a real estate appraiser, you’re probably unaware of a major catastrophe looming that could effectively eliminate all types of hotel financing, making it all but impossible to either build or sell a hotel. Under potential new governmental lending regulations, hotel appraisers will be forced to utilize an appraisal methodology that will lower their hotel valuations by as much as 40%, forcing borrowers to finance significantly less of their acquisition prices at greatly inflated interest rates. While this topic is somewhat technical, I will attempt to describe the issues in simple terminology....
Who’s Got Money for Hotel Financing?
The long hotel financing freeze is slowly beginning to thaw. That’s a common sentiment of both participants in a recent roundtable of industry executives held at Michigan State and respondents to the annual Hotel Brokers International/Lodging Hospitality survey of lodging lenders. And if you’re looking for financing—and who isn’t?— be sure to register for ...
Another Optimistic Outlook for the Hotel Business
While the pace of the hotel industry’s rebound may at times seem to be excruciatingly slow, it is very real, particularly if you look street corner by street corner. “I think we were all hoping for a quick rebound, but ...
Panel Says Caribbean Tourism Is Hot, Financing’s Not
Despite the many challenges it faces—the state of the world economy, rising fuel prices, increased taxation—the Caribbean tourism industry is in good shape today and has a bright future. That was the conclusion of multiple speakers at last week’s Caribbean Hotel & Tourism Investment Conference in San Juan. Despite the worldwide economic downturn, the region’s hospitality industry saw record numbers of tourist arrivals in both 2010 and 2011....
Timeshare Business Continues to Rebound
The mood was understandably festive as executives gathered in early April in Las Vegas to cut the ribbon on Holiday Inn Club Vacations’ newest property, the 640-unit Desert Club Resort just a few blocks east of The Strip. Holding the ribbon was Don Harrill, president & CEO of Orange Lake Resorts, the developer of Holiday Inn-branded timeshare properties. Despite the lingering stagnation in the economy, Orange Lake Resorts is enjoying strong success in finding the needed funding for expansion....
How to Estimate Hotel Mortgage Interest Rates
In today’s low mortgage interest rate environment, hotel investors need to constantly monitor the cost of financing to ensure they lock-in the lowest possible rate. Generally, a hotel investment consists of a large amount of mortgage money (55%-75% of the total investment) and a smaller amount of equity capital (25%-45%). Thus 55% to 75% of a hotel project's cost of capital ...
Conferences Explore Caribbean Investment Opportunities
The Caribbean hospitality industry is facing some tough challenges. Higher fuel prices reduce the region’s ability to compete for visitors with other destinations and increase operating costs for hotels and resorts. Airlift into the region is always a concern and now, according to recent press reports, American Eagle is considering abandoning its inter-island air service in the region. And the individual governments in the area have a poor record of working together to market the Caribbean as a single destination....
Different Ways to Restructure a Hotel Loan
After four years of negative and negligible growth, the U.S. economy is finally showing signs of recovery. Despite this, global events including financial challenges throughout Europe and political turmoil in the Middle East may contribute to tipping our economy back into a recession. ...
Great Opportunity Exists for Non-Institutional Buyers
While REITs and many private equity buyers remain quiet, opportunities exist for other investors to take advantage of a lodging market ripe with promise....
Kimpton Chief Talks Adaptive Reuse
CEO Mike Depatie claims Kimpton Hotels & Restaurants is likely the biggest adaptive-reuse boutique hotel company in the country. Of the company’s 52 properties, 12 are adaptive-reuse projects. The latest project is the Schofield Building in the heart of Cleveland, OH. Built in 1902, the 110-year-old office building will open this year as a 161-room Kimpton-style boutique hotel with a chef-driven restaurant. The yet-unnamed property, owned by CRM Real Estate, will include 25 luxury apartments and ground-floor retail....
Hotel Executives See Clear Path Ahead
The Americas Lodging Investors Summit, held each January on the West Coast, is a good early bellwether of industry sentiment for the year. Budgets are complete, plans are made, and executives are hungry to execute. To get a reading on the sentiment for 2012, Lodging Hospitality gathered a roundtable of industry leaders during this year’s ALIS to gauge future developments, challenges and opportunities for the lodging business....
