financeHotels Magazine··1 min·For: Owner, Investor, GM, Revenue
Essential Tips for Hotel Owners Choosing a Lender
Selecting a hotel lender requires looking beyond interest rates to understand complex cash management agreements and how they impact daily operations. Control over cash flow, especially in brand-managed properties, is often more critical than loan proceeds or timing.
Key Takeaways
- 1Evaluate cash management structures to determine whether the owner or lender holds primary control over daily operating liquidly.
- 2Analyze 'springing' versus 'hard' cash management triggers to understand when a lender can legally sweep revenues into their own accounts.
- 3Coordinate with brand managers early to ensure management fees and operating expenses are prioritized before debt service in loan agreements.
Source: Hotels Magazine
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