The global financial crisis was felt across all industries all around the world. The hotel sector was no different, with many investors experiencing a very difficult time. However, there was light at the end of the tunnel, and 2014 proved to be a far better year. The crisis also brought about a change in the financial landscape as lenders and investors looked to protect themselves more effectively in the future. Rather than lending based on property alone, they are now looking more at the business side of things and ensuring that enterprises will be able to maintain their cash flow and service their debt.
Securing hotel finance now can be a little more difficult as you need to provide far more information about your plans and forecasts. With lenders tightening up their restrictions, borrowers need to show they have a good business plan, have considered important factors like seasonal demand and occupancy numbers, and consider their cash flow. Five key elements have been identified to help businesses secure the finance they need. These are:
– An experienced and/or invested management team
– Committed investors
– A business plan covering projections and cost control measures
– A marketing strategy including what channels will be used
– A strong brand
People who account for these factors stand the best chance of creating a robust proposal and securing the hotel finance they require. Showing you understand the market and can reach out to customers is essential, especially if your property is to be outside of major capital cities. Lenders are increasingly knowledgeable about the sector so you need to show them you are aware of and ready for the challenges you will face.
At Stewart Hindley & Partners LLP we specialise in helping people to find the right hotel finance for their enterprises. We can help clients to find initial funding, loans and mortgages, or we can assist them with re-financing to suit their needs. Our knowledge of the sector and our extensive experience can prove to be a great resource and we will do all we can to give you the support you need. To learn more about our services or for information about lending for a hotel, guest house or bed and breakfast please contact us.