Hotel financing can be a complicated issue, whether you are refurbishing, buying existing properties, or building a new hotel, you need to be sure you have a good plan in place. For your project to be successful, you will need to be able to make the payments on the mortage, and any construction loans until the hotel begins to turn a profit.
Before any attempt can be made to secure hotel financing a working business plan must be developed. A strong business plan should cover all aspects of your operation, from construction, through to the loans being paid off, and ideally several years past that. If you are unable to show that the hotel can trade and turn a profit without the need for future loans to be taken out, then it will likely be very difficult for you to obtain financing.
Any business partners that you are involved with will naturally want assurances that their investment is a secure one, and that, should things go wrong, there is a plan in place that involves more than just selling the property to recoup any losses. In other words, you cannot have a plan stating if something goes wrong and you cannot afford the payments, you will sell the building and...
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