We're placing an acquisition loan on a hotel right now, and the market feedback has been sharper than most sponsors expect. Debt is available for the right operator on the right asset — but lenders are underwriting the flag, the PIP, and the sponsor as hard as they're underwriting the trailing revenue.
What lenders are pricing
- Flagged, in-market operator, PIP funded: bank and debt fund appetite is real, pricing tightens meaningfully
- Independent or soft-branded: debt-fund territory, expect a wider spread and a real interest reserve
- Value-add repositioning: bridge only, with a defined stabilization plan and take-out narrative from day one
The four items that move the term sheet
1. Trailing revenue quality
STR reports and comp set penetration matter more than headline RevPAR. Show the trend, not the peak.
2. PIP reserve sizing
Under-reserving the PIP is the fastest way to lose a lender. We size to the franchisor letter plus a contingency, and structure the draw mechanics to protect the sponsor's cash.
3. Sponsor operating story
Lenders are asking who runs the asset day one, day 90, day 365. A management agreement with a proven operator can move pricing 25–75 basis points.
4. Exit or refinance path
Bridge lenders want a plan; bank lenders want durability. Both want to see the take-out modeled honestly.
Have a deal that fits this thesis?
We place debt and equity on commercial real estate transactions over $5 million. If any of this maps to what you're working on, let's talk.
