Expertise in Commercial Hotel Purchase with Terry Baltes

Purchasing a hotel, whether for the first time as a mom and pop, or to add to a growing hospitality group in the business model, requires the proper lending and financing to maximize the success of the venue, and of the property holder. The many aspects of consideration in applying and being approved for commercial lending can be a quagmire to the hotel buyer whose area of education and expertise is not in the area of finance, but in the world of hospitality.

Terry Baltes

Some rules are used for approval of commercial loans for hotels are universal to other types of commercial loans. But additional and complicated stipulations may be used by money lenders for hotel loans, some of which may be related to the location, ordinances and zoning of the community.   If the hotel property currently exists or if it is under construction for hotel use, affects how lenders will view the financing. Hotels currently operating and under purchase from the originating is regarded as an acquisition loan, not a construction loan. Additional documentation and information must be acquired by financiers if these conditions exist, making it important to have a complete portfolio on the property and on the purchaser.

“Financing is back,” asserts Terry Baltes. “We have numerous lenders, conventional as well as SBA, back in the market. Conventional lenders are looking for 25-30% down payment, while SBA lenders are looking for 15-20% down payment. Interest rates remain very attractive at the low 4% range…our aggressive marketing program (leads) buyers all across the country to call us every day, wanting to buy hotels like yours.”

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