There are several myths and misconceptions made about hotel loans that, if allowed to shape bank strategy, will destroy your ability to maximize and accelerate your recovery. The myths include: 1. Hotels are just like any commercial real estate project. 2. Franchised hotels produce consistent results. 3. Occupancy and average daily rate statistics produce "stabilized" income, much like any other multi-tenant commercial property. 4. The most dangerous myth is: "It's the economy." Reality is that a perfected interest in a hotel property is worth little if the property's operating performance is poor. The lender must have a detailed understanding of the operating results, how they were achieved and what is required to produce a successful recovery.
Hotel loans David Weir; Curt Petersen Northwestern Financial Review; Mar 1-Mar 14, 2010; 195, 5; Docstoc pg. 8 Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
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