There is an array of options when it comes to financing hotel property, here are a Few:
-Hotel Bridge Loans, which are a short-term loan option, generally with a high interest rate.
-Hotel SBA 7a Loans, which are a great first time hotel buyer loan, as well as for any short-term hotel investments.
-Hotel SBA 504 Loans, which offer low rates for long-term fixed periods for hotel property financing. As with a SBA 7a Loan, the 504 program also supports first time hotel buyers, with given hotel management experience. An SBA 504 Loan for hotel financing is also generally used for a long-term investment.
-CMBS loans for Hotels, offer a low interest rate for financing, although they carry high prepayment penalties and other fees associated with completing the loan process.
-Hotel Mezzanine financing offers a collateral free debt financing option for the hospitality industry. Because there is no need for physical assets to back up the loan, the interest rates tend to be much higher than traditional loan rates. Mezzanine financing for hotels can also provide tax incentives for the borrower. The borrower may make tax deductions for the paid interest on the loan.
See more on Prime Commercial Lending’s Commercial Real-Estate Financing programs, here.