How can debt restructuring help my hotel business?

One year into the coronavirus pandemic, the European hotel industry still faces a great level of uncertainty. With several government support packages and ways of restructuring, the industry is responding differently in each country to ensure businesses can continue to be viable in the aftermath of COVID-19.

In the UK, employee furlough schemes, business loans and suspensions on evictions have allowed the industry to continue trading and prevent the detrimental effects of lockdowns. However, there are still tough times ahead for the industry and Kate Nicholls, of trade body UKHospitality, says businesses need “enhanced grant support to keep venues alive and a solution to the ongoing rent debt problem that continues to linger over the sector.”

As owners and managers of hotels are left with plummeting occupancy rates, they now need to work out how to pay debt-related obligations and keep their hotel business afloat. Debt restructuring is a strategy that can help to find suitable funding and refinancing options to ease the pressures of trading difficulties, especially during these unprecedented times.

What is debt restructuring?

Debt restructuring is a process that allows businesses experiencing financial difficulties to refinance existing debt obligations. It makes debt more manageable and can provide much needed flexibility to businesses who need it in the short term.

How can debt restructuring help my hotel business?

If you are unable to meet your loan repayments to a commercial lender for your hotel business, you may feel under extreme pressure and your livelihood could well be at risk. A restructuring agreement can help to make your debt more manageable and ensure that once the pandemic passes, your hotel can still run effectively, and you and your employees will still have a job.

There are several ways this can be achieved but negotiating the terms of your debt payments with your lender can help you to secure positive outcomes and maintain your financial relationships.

Debt restructuring experts

Here at Stewart Hindley, we are experts in debt restructuring within the hospitality industry and will work to secure the best possible outcome for your hotel. We will help to guide you through the complete process and act on your behalf to reach a consensual agreement with your commercial lender.

Firstly, we will complete a full review of your business and negotiate with your commercial lender to agree on a recovery strategy for your hotel. We will also introduce new lenders who may be able to refinance your existing debt and achieve a repayment forbearance period whilst the restructuring takes place.


Contact Stewart Hindley today

If you’re a hotel owner or manager trying to navigate these challenging times and need experienced support and help with your business finances, please don’t hesitate to get in touch. We can look at your individual circumstances to help you secure the debt restructuring your hotel business needs.

How to get a mortgage for a bed and breakfast

Owning and running a bed and breakfast is something many of us dream of. What could be better than living in an idyllic location, running your own business and enjoying the chance to meet new people?

For those who are lucky enough to make this dream a reality, there are several practical steps to overcome – from finding the right property in the perfect location, through to securing a mortgage.

If you’re thinking of buying a B&B for the first time, here’s our guide to getting a mortgage for your dream business venture.

What type of mortgage do I need for a bed and breakfast?

When buying a B&B, you will definitely need a commercial mortgage. In some cases, if you’ll be living in the property and over 40% of the space will be used for your own residential purposes, then you’ll need a regulated commercial mortgage.

You’ll typically be expected to pay a deposit of between 30% – 40% for your commercial mortgage. The exact amount will depend on the terms of the mortgage and the level of risk involved. For first time B&B buyers, lenders will usually require a 40% deposit.

When considering your application for a commercial bed and breakfast mortgage, lenders will take into account the following:

Business plan

When you take out any commercial mortgage, the potential lender will want to see a thorough business plan, clearly demonstrating:

  • How you will run the business
  • Your long-term plans
  • Financial projections
  • Your marketing plan for ensuring high levels of occupancy

Trading history

Lenders will look at the bed and breakfast’s existing trading record and will likely want to see 3 years’ worth of accounts for the business you’re buying.

If the business you are buying does not have a strong trading record, there are still some lenders that will consider your mortgage application, if you can demonstrate that you have a comprehensive plan in place to improve profitability.

Credit history

As with any mortgage application, the lender will want to see that you have a strong credit history. There are lenders that offer bed and breakfast mortgages for those with a poor credit history. If this is the case, you will usually need to find a specialist provider, and you won’t necessarily be able to access the preferred rates.

Your experience

The lender will consider how much experience you have in the sector. Of course, experience isn’t essential, and lenders understand that many B&B buyers are moving into the industry for the first time, but any relevant industry experience will be looked upon favourably.

Speak to a specialist broker

If you’re buying a bed and breakfast, it’s well worth speaking to specialist broker with experience in securing mortgages for B&Bs. They will help you source the most competitive offers, undertake all of the work for you to include the financial business plan, revenue and cash flow projections as well as the marketing plan ,as well as handling all of the required paperwork, which will increase your chances of being approved.

To find out more about how to get a mortgage for a bed and breakfast, get in touch. Call us on 01488 684 834 or email:

What is asset financing?

Asset financing is a type of loan designed to enable the purchase of high-value items or resources on behalf of a business. These items or resources are known as assets.

Taking out asset finance makes it possible for a business to secure the assets it needs and pay for them gradually over time through fixed repayments, making asset financing good for cash flow and achieving business growth. Asset financing may also involve a business using an asset it already owns as security against a loan to boost working capital.

A business of any size can make use of asset financing, as long as it can meet the criteria required to secure the loan.

What counts as an asset?

In business terms, an asset is an item of value that provides business benefits. All businesses need assets to carry out operations or generate an income, and may secure assets by purchasing or leasing them.

Examples of business assets include buildings, vehicles, IT equipment, inventory and raw materials.

Types of asset finance

The two main types of asset financing are Hire Purchase and Leasing. Both involve borrowing funds from an asset finance provider to procure a business asset, but differ with relation to what happens to the asset after the loan term.

Once a Hire Purchase asset financing agreement is settled, the asset either automatically becomes the property of the business or they will have the option to pay a final payment and own it outright.

Conversely, at the end of most Leasing asset financing agreements, there is no option for the business to purchase the asset and keep it, although Stewart Hindley is proud to be different. We offer our leasing customers the chance to own their leased assets outright via a process called passing title, for a fee agreed at the start of the loan term.

Why asset financing?

There are many benefits to asset finance for businesses. Many opt for asset finance so that they can spread the cost of large outlays, stay in control of cash flow and put working capital back into the enterprise itself, rather than investing in assets upfront. There’s also no need to provide extra loan security, since the asset itself acts as security.

Asset financing loans can run up to a maximum term of seven years and the repayments are fixed, so a business can budget exactly with no danger of hidden costs. Interest rates for asset finance tend to be lower than those associated with other forms of lending too.

If you’re ready to find out more about asset finance for your business, get in touch with us today.

What is hotel financing?

Hotel financing is a type of commercial mortgage designed to fund a new hotel, guest house or B&B project or to reinvigorate or refinance an existing one. This type of finance is specifically intended to meet the particular needs of hoteliers and hospitality businesses.

While it is possible to obtain a commercial mortgage for hotel financing from a traditional bank, hotel finance is best sourced with the help of an experienced hotel finance broker with access to exclusive rates from the whole market.

The hotel and wider hospitality industry is fiercely competitive yet highly rewarding for those with the qualities lenders are seeking, so it pays to prepare an application for hotel financing with expert guidance.

How does hotel financing work?

Hotel lenders will only consider the most robust hospitality business opportunities, and there are strict criteria that govern the hotel financing application process.

Anyone seeking hotel finance, whether they are new to the industry or a seasoned hotel operator, will need to submit detailed forms regarding their hotel business and business plan, their experience in the sector, as well as their plans for the loan and how it will be repaid. While experience in the hotel trade is a definite plus when seeking hotel finance, it is entirely possible to secure a commercial mortgage for a hotel business as a new to trade hotel buyer.

In most cases, lenders will look for a deposit of 30% or more, additional security, a solid business plan, a good personal credit rating and three years of trading accounts from the loan applicant and the hotel vendor.

When a hotel financing application is made via a specialist broker like Stewart Hindley, these criteria are put to specialist lenders from across the whole market with whom the broker has established years of positive rapport. It’s the job of a hotel finance broker to not only help the applicant create the most attractive business opportunity, but to seek out the most suitable lenders on their behalf.

Securing hotel finance

At Stewart Hindley, we have refined an expert approach to assisting both experienced hoteliers and those new to the trade in securing hotel financing. Our specialist team can guide you through the complexities of building a strong hotel finance application, before identifying the best potential investors and obtaining the best market rates.

Get in touch today to find out how we can help you acquire the hotel finance you need to turn your hospitality vision into reality.

How is coronavirus affecting the property market and loans?

The Covid-19 pandemic has had a significant impact on virtually all aspects of the UK economy, and it’s likely that the effects will be felt for months, or even years, to come.

And this includes the commercial property market.

What does it mean for the commercial property market?

During the initial lockdown back in March, the commercial property market was hit hard, with widespread lockdowns coming into force throughout the country. The vast majority of businesses were asked to shut their doors completely, or encourage their workforce to work from home, leaving many commercial buildings up and down the country, standing empty.

Data collected has already indicated that less than half of tenants paid their rent on time on June Quarter Day, meaning commercial property landlords only collected 38 percent of their rent.

The situation is still very unstable and the threat of a second wave of the virus, with the possibility of further regional lockdowns is very real. With this in mind, we anticipate prices and demand will fluctuate for at least the next few months as the market adjusts to the ongoing economic environment.

How have commercial property prices been affected?

There’s no denying that the retail and commercial property sector have been hit the hardest and this naturally has had an impact on commercial property prices. Experts predict that rent arrears will not only be an ongoing issue but the capital value of many commercial properties could also fall by as much as 20-30 percent.

Essentially, things are still very uncertain. However, for first time buyers in particular, this could mean there are some great deals to be found.

What does this mean for commercial mortgages?

Commercial mortgages have been a hot topic during the pandemic as they have been a great way to purchase property, or refinance a property that’s already owned. Many business owners are contacting commercial mortgage lenders for additional borrowing, for reasons such as:

  • Securing a better interest rate
  • Recouping funds
  • Reducing monthly costs
  • Gaining financial support
  • Taking advantage of the spike in the market

However, it’s important to be aware that, as with in the residential property market, commercial lenders have become far more cautious as the UK heads towards another recession. With this in mind, if you are considering purchasing a commercial property during the pandemic, you can expect lower loan-to-values and more stringent affordability checks.

That said, there are still plenty of lenders out there to choose from.

If you’re looking to take your first steps on the commercial property market, or you’re planning on selling your property and looking to secure finance, we can help you find the best deals around.  Get in touch to discuss your property finance needs.

An Introduction to Commercial Development Finance

Whether you’re looking to take your first steps onto the commercial property ladder, or you want to kick start your next project, you will probably find that you need to source commercial funding.

There are a whole host of commercial development finance solutions available for landlords, property developers and investors. But the lending market can often be overwhelming, even for the most experienced property developers and landlords.

We’ve created a helpful introduction to commercial development finance – we hope that you find it useful.

What is development finance?

Development finance is a type of loan that releases a set amount of funds in stages, in order to cover the cost of the development of a commercial property.

The funds are generally released at set stages of the project and are typically taken out over a period of six to 18 months. So, for example, funds are released in the early stages to secure the property and then at various points throughout the project to allow for construction and refurbishment.

Once the project has been successfully completed, the property can either be sold or a commercial mortgage can be taken out against it.

Whether you’re completing a short-term refurbishment project, major renovation work or a ground up development, there are lots of development finance options available, designed to accommodate your project scope and time frame.

Commercial development checklist

If you’re considering applying for commercial development finance, almost every lender will ask for the following information before they start processing your application:

  • Details about your company
  • Your development track record, including evidence of experience and proven returns
  • Six years’ business accounts and tax returns
  • A thorough breakdown of project costs
  • Detailed development plans
  • Estimated gross development value (GDV)
  • Details of assets and liabilities associated with your company
  • Exit strategy plan

The amount you’ll be able to borrow depends on a number of different factors, including your credit history, how long you need the finance for, and your track record when it comes to managing and delivering successful property development projects.

There is also a range of other development finance options that can be used to tap into the commercial property sector, including commercial mortgages, bridging loans and auction finance.

Choosing a commercial mortgage for your exit strategy

Commercial mortgages are used to purchase a wide range of commercial properties such as offices, warehouses, shops and other commercial buildings. They are commonly taken out following a commercial development project.

Just like a residential mortgage, commercial mortgages allow property developers to purchase a building and spread the cost over a set period of time.

If you’re considering buying a commercial property, it’s important to speak to someone experienced in the sector to ensure you are aware of all the funding options available to you.


Get in touch to speak to one of our skilled and experienced team. Here at Stewart Hindley, we are always on hand to answer any of your queries regarding commercial mortgages and commercial development finance.