Developing a hotel is no easy feat and generally requires very significant capital. Specialist lenders tend to be the go-to players for hotel development finance due to the complexity of these types of transaction.
Where commercial property is often 'good to go' at the end of development, hotels are a different ballgame entirely. Even the best hotels can take some time to get into a profit-making position, and lenders will factor this
in carefully. Lenders will look very closely at where you plan to build or the property you plan to buy. Like traditional commercial developments, lenders will look at the whole project to determine how much (and if) they want to lend. The reputation of your partners, suppliers and builders, how much experience you have, where you will develop your project, the market the hotel will serve, and the loan-to-cost ratio will all be carefully considered. The hotel's launch, marketing the hotel, its management team, projected occupancy/income and how long it will take to reach normal occupancy levels will also make a difference. You will need to have a rock-solid financial case to take to lenders and be prepared for lenders to go into very explicit detail to see if your numbers and timeline add up.
As with any type of borrowing, you will have several options for hotel development finance. Enness will help you find the most competitive deal in terms of rates. Your hotel development broker will also be able to negotiate advantageous terms for you and work with your team to structure your finance in the most advantageous way.