Carolina Hotel Partners Refinance and Buyout

Loan financing can often accomplish multiple things. In the case of our North Carolina hotel owners, their two loans refinanced existing debt and also bought out partners.

Our clients came to us with two Carolina hotel properties. The two hotels, situated in different markets, had been jointly owned by the partners. However, each partner was now ready to take on full solo ownership of each hotel. The GRP Capital Team worked closely with our lender network, finding a lender who would handle both loans. Not every lender is willing to fund both a refinance and partnership buyout.

Our team was very happy to close both loans in quick succession, which required a fair amount of coordination.

Krishan Patel, GRP Capital Managing Director noted, “Partnership buyouts occur for lots of reasons. We worked very hard to structure this loan. As a result, we found lenders who were interested in our clients and their business plans. The new loans are stable and competitively priced. More importantly, the partners’ ownership is now in line with their business and personal goals.”

Our team also encouraged specialized help for our clients as they prepared for the appraisal process. The hospitality appraisal consultant worked directly with the appraisers, to make the case for the highest valuation possible. Lenders and appraisers are cautious right now, especially in the hospitality arena. Therefore, it is particularly important to approach an appraisal with data that can support maximum valuation.

Considering a partnership buyout?

• Determine what the new ownership structure should be.
• Decide who will be required (or wishes to) guarantee the loan.
• Think into the future. Will any of the partners be interested in future SBA financing? If so, be sure that those partners are aware of their eligibility for future loans.
• Engage an attorney to review and revise corporate documents including bylaws and operating agreements. These documents will need to be revised to show the desired new ownership structure.

More Information on the Appraisal Process

Our GRP Capital team specializes in finding the right lender for each project. We save our clients time and money, as we research the best choices for their funding sources. Our experience allows our clients to find funding that is project-appropriate and will allow for sufficient cash flow. Whether you are looking to refinance, purchase or engage in construction, we would love to discuss your business plans with you. If you are considering becoming a first-time (or second or third time!) buyer, we can assist you.