Did you set goals for 2019? Did you make promises to eat healthier, exercise regularly and be kinder to your mother-in-law? How are those resolutions holding up?

It is equally important for entrepreneurs to set achievable business goals—ones that will help your enterprises become more profitable.

At GRP Capital, we want all of our clients’ businesses to grow and prosper. We also know that growth doesn’t just happen. Growth occurs when owners and managers brainstorm the best ways to bring in more revenue, operate more efficiently and expand intelligently.

Some of our most successful clients have used the following methods to create growth, which has also improved their work life and contributed to greater personal wealth.

Property Improvement and Renovation:

Be honest about your property, whether it’s a hotel, assisted living facility, restaurant, office building, retail space, school or storage facility. How does it look to a new guest or visitor? More importantly, are there remodeling projects that would bring in revenue? Could you expand a lobby to include a fuller meal service? Would the cost of adding an elevator be offset by convention rentals?

Does your business have a season? For many businesses, summer drums up more business. Therefore, making decisions about renovation in the winter is an excellent idea as you can begin the construction right away and plan to be done by summer.

Financing Changes:

How is your current business financed, if at all? Often, you can benefit from the advice of our GRP advisors who will consult with you on the best types of financing for your goals. They can assist you in finding a loan that is a better fit or they can create a loan package that will allow for expenses and working capital so you can generate more growth.

This might be the time to contemplate switching types of loans. Consider changing from an SBA loan to a conventional loan or examine whether a non-recourse loan would be a good fit for your business plan. A bridge loan might be a great option when short-term financing is needed.

Brand New Project:

If you have proven yourself as an entrepreneur and manager, you can capitalize on your experience and equity to expand your reach into another similar project. You can also branch out into an “adjacent” business, one that utilizes your skills and knowledge, that allows you to experience new challenges and create new growth. We can help you evaluate market trends in various fields and help you assess the risks and rewards for traversing a new business path.

Franchise Changes:

In the hospitality world, clients often find that certain franchise affiliations offer greater opportunities for increased profits either because of corporate support, brand reputation or proximity and competition issues. There are times when “reflagging” a property is an excellent idea, especially if the costs can be quickly made up with increased occupancy and daily revenues.

Marketing Matters:

What were the ways that people found you and your business? What was the best use of your marketing dollars and what should you change in 2019? During winter is a great time to go over all of your financials from 2018. The numbers are a better indicator than just your gut feeling. When were you truly the most profitable? Why? Can you capitalize on these drivers?

The Alaskan Inn – Ogden, Utah

GRP recently arranged the financing for the purchase and renovation of the Alaskan Inn in Ogden, Utah.

Our client was an experienced builder, both of custom homes as well as office and retail space. He had a vision of what type of remodeling this boutique inn could benefit from. He was ready to try his hand at hotel ownership, utilizing the excellent management team that was already in place combined with his skills and knowledge regarding property improvement.

The Alaskan Inn is located near several ski resorts but was not currently marketing its proximity to the local ski scene. Also, this boutique bed and breakfast had previously been marketed as a couples’ retreat which limited family travelers, reunions and other groups from considering the locale during vacations and travel.

We were able to match our client with a Small Business loan product which provided him with competitive rates, funding for his property improvement and financing to purchase the property.

Our client took possession and immediately began renovations, reconfiguring the guest units so that whole families could occupy each guest dwelling. In addition, he made plans to put the property on the shuttle route for one of the local ski resorts so that clients could easily get to the gorgeous slopes nearby.

The Alaskan Inn already has devoted regular guests who love its breathtaking views and its unique setting. With skilled management and an eye for design, our client is sure his new property will continue to bring great joy to its guests. Our client was thrilled that, just before the renovation, Hallmark featured the property in their Christmas special, “Christmas Made to Order.”

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

You have a great business idea. It’s well-researched, you have set aside money for an equity injection and you have a solid business plan.

Now all you need is financing.

Is your next call the local bank?

Not necessarily.

Just as you are the expert in your own business, we are an expert in ours. You should know a little bit about what banks are considering as they are evaluating your business ideas to decide whether or not to fund them.

Banks are not that interested in new ideas:

It’s true. Banks want to fund businesses that have a proven track record of success. So, bank underwriters want to see business owners who have a hefty paper trail of documents showing previous successes. Brick and mortar lenders are typically not willing to take a risk on a brand-new concept, even if the loan applicant is an experienced business person.

Each bank has a finite amount of money for each variety of loan:

Bank management set goals and limit funding decisions based upon those goals. Each bank has different “buckets” – these could be buckets for various industries, buckets for businesses that are in a specific geographic area or even buckets that do or do not qualify for Small Business Association (SBA) guarantees. Some banks won’t do any construction loans; others have ample funding for construction.

If you don’t understand the allocations and the risk-averse nature of each specific bank management team, you may be wasting your time and money by applying for a loan that the bank will not eventually close.

We encourage you to call GRP Capital first with your innovations and ideas.

We advise our clients in two specific ways: securing traditional lending or finding other avenues when traditional lending is not the answer.

If we feel that your business can find funding in the traditional marketplace, we help match your needs with one of our many lending partners. By doing our due diligence on your behalf and knowing the goals of the various lenders, we have found greater success in sourcing
funding and more expedient loan closings for a large variety of clients.

We also evaluate if your business is a good candidate for funding with the GRP Capital Debt Fund. Having the vast resources of the GRP Capital Debt Fund allows us to secure funding when traditional lenders are not the correct solution. We have successfully provided loans for acquisitions, interim refinances and construction shortages.

GRP Capital can help secure funding for a variety of projects in construction, hospitality, storage, senior housing, student housing, retail and office space and medical buildings.

The Learning Experience – New Haven, CT

The Learning Experience property was not a cookie cutter business and needed some expert assistance to secure funding. The majority of the costs in starting this business were rolled into franchise fees. Our client was not required to supervise construction or remodeling but would instead receive a turnkey operation. This setup is not a typical SBA one and GRP Capital and our lending partner had to make the case with the leadership of the SBA that the business model was a sound one and that our client, who already owned a Learning Experience in another location, was worthy of funding.

Our client received funding and was able to start the school year with a pristine facility, ready for children and teachers.

Springhouse Living – Cartersville, GA

GRP Capital Debt Fund stepped in to fund Springhouse Living in Cartersville, Georgia. Our clients saw the facility, a former hotel, and realized that it had the bones to be utilized for greater profit as an assisted living facility. In addition, the facility would be located in an underserved area, where residents had to travel untenable distances for assisted living options.

GRP Capital believed in our clients’ ability to oversee the conversion and to achieve the necessary cash flow to pay back their loan. This was a perfect use of the GRP Capital Debt Fund, sourcing financing when traditional lenders were reluctant to do so. Move-ins to the new facility are expected in April.

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

We enjoyed seeing old and new friends at the AAHOA 2019 convention in San Diego. Thanks for stopping by our booth. We hope to keep in touch with you throughout the year, and of course, we’ll see you next year in Orlando!

Are you considering renovating your property? It’s a very big decision. Before you embark on this potentially expensive adventure, you need to consider the following:

1. How much will the renovation cost?
2. How should you fund this project?
3. What’s the best way to limit revenue displacement during the renovation?

How much will the renovation cost?

It’s essential to have clear, realistic expectations about the costs of renovations. Create budgets for every aspect of the renovation, including FF&E, labor costs and any permitting and inspection costs.

If you are seeking financing for your renovation, you will need estimates and invoices. More importantly, you will not be able to undertake a DIY mode for major projects. You need to use licensed workers. Furthermore, lenders will often insist on paying vendors and contractors directly to assure the work is being completed as agreed.

You will also need to consider that renovations may run over budget. Set aside a comfortable contingency allocation to cover these cost overruns.

How will you fund your project?

Conventional loans, bridge loans, and Small Business Association (SBA) loans are just a few of the products that can provide short or long-term financing for renovation.

GRP Capital can help analyze your project ideas and determine if it is likely to lead to increased revenues or higher property values. We will help you assess your budget to make sure it is not only realistic but also affordable for you. We can also assist you in finding ways to increase revenue and reduce costs going forward as ways to afford the needed renovation. Most importantly, we will help you decide if your proposed project has a return on investment that is worth the outlay before the bank makes that judgment.

Part of our analysis is determining why people choose to stay at your property and why they choose other properties. This can underscore what renovation projects could bring the greatest value to you and would outweigh the expenses—short term and long term. If you participate in the STR reporting system, these reports give a nice snapshot of how your property functions in your local market.

Most importantly, GRP Capital packages your ideas and presents them to potential lenders, showing the value of your project and your ability to make loan payments in a timely fashion. In this way, we can partner your project with an appropriate lender or even utilize our in-house debt financing sources.

What’s the best way to limit revenue displacement during the renovation?

During a renovation, you may lose the use of parts of your business; there can be disruptions in parking, food service, or rooms. Planned and unplanned delays amid construction can cost you money during which facilities cannot be used. Here is our advice to minimize revenue displacement:

1. Make sure all plans are complete before the first hammer comes down. Do you need permits? Does your renovation trigger a code change (like ADA) that requires new inspections and/or new municipal approvals? Have all architectural drawings been approved by you and any qualified engineers? Will there be needed changes in plumbing or exit configurations because of the construction? Count the rooms and be sure that everybody agrees with the number of rooms and the room type that will be the outcome.
2. Get prior approval on renovations from lenders and franchisers, especially if the renovation is required for rebranding or reflagging.
3. Consider if you need to break up renovations into smaller mini projects to limit downtime.
4. Make sure all replacement products are on hand or available before removing old stuff (like carpeting, drapes, furnishings). This is an easily avoidable delay.
5. Choose a renovation schedule that limits the negative impact on your bottom line — schedule renovations during times when you might have less demand. At the same time, be sure that your contractors will have enough skilled laborers in your community to get the job completed on time.
6. Can you set aside one or more rooms as your “test subject” for renovations? When you install new lighting, furniture or change configurations, you can see what works and doesn’t work in this one room and learn your lesson before making multiple mistakes on multiple rooms.

Plan, plan some more, and then contact GRP Capital. We encourage you to dream big and small to find ways to make your properties work for you. We are happy to help secure funding so you can achieve your business dreams.

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

In our personal lives, we receive lots of messages that debt is a four-letter word. But debt in the business world is a different issue altogether.

Strategic use of debt can allow you to grow your business, funding necessary projects and acquiring promising properties that you cannot pay for all at once.

Part of our growth at GRP Capital has been increasing the monies that we have available through our GRP Debt Fund.

The GRP Debt Fund is an excellent resource for lots of small business financing, particularly:

• Supporting business growth that is considered somewhat risky for traditional loan instruments
• Funding construction shortages, a common occurrence, which often is ineligible for typical loans
• Bridge loan financing when a quick sale or purchase is critical and delayed permanent financing can occur down the road
• Short-term financing when a Small Business Association (SBA) loan is not available due to eligibility issues
• Providing funding when the bank with which you have a business relationship is unable to lend money

Part of our services in providing funding through the GRP Debt fund is our consultation. We work with you to help you find permanent financing if that’s what you wish. We also advise on structuring your other debt and making necessary changes in current operations and management.

All of our GRP Debt fund loans are serviced in-house, which makes your life easier. We want our clients to focus on running their businesses.

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

The messages that we hear over and over from the leaders in the business development, marketing and management world (and the most highly regarded professors in business school) are:

Be creative!

Take a risk!

Be innovative!

Pursue your dreams!

Be single-minded!

It’s great advice for owners and managers, builders, and investors.

There’s only one issue . . .

Banks are naturally risk-averse. And the Small Business Administration can be risk-averse as well.

What frightens banks and the SBA? Newness and innovation.

Does your project include newness like one of these categories?

• A brand new idea, not even franchised yet?
• A new franchise or a new brand or a new division within an existing franchise
• A new location
• New construction
• Repurposing of a previous building for a new business

Don’t be afraid to innovate.

But do be cautious about going out on your own to shop for financing. There are so many financial institutions in the marketplace. You could waste hours and hours of your time trying to make a match, filling out forms, submitting personal and business information, only to be rejected because this or that bank really has no interest in your innovation.

Your time is better spent telling the GRP team about your dream project once and then letting us do the legwork for you.

Our process is transparent:

1. We evaluate your idea and give you feedback.
2. We’ll tell you if we think your project is feasible and if the timing is right.
3. We’ll also tell you if we think you need to make alterations before proceeding. We do this because we represent you and not the lenders.
4. We’ll determine together what the most important financing elements are to you, including rates, length of payback time, minimizing closing costs, extracting working capital or speed of closing.
5. We will decide together if you should seek traditional financing or whether the GRP Capital Debt fund is the better option.
6. If we are seeking traditional funding on your behalf, we will help package your project and present it to competing lenders, based upon who we think will offer the best path to closing an acceptable loan.
7. Once a lender is approved by you, we will help you gather and submit all of the necessary materials and guide you all the way to closing.

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

People visit hotels because they’re on vacation or needing to see family members or because they are working nearby.

Sometimes hotels become a place of refuge when we can’t live in our own homes due to storms, electrical outages, or other major and minor disasters.

Hotels are a second home, born of necessity.

So what happens when hospitality properties are damaged? Hurricane season is upon us, and all of the coastal properties and those not too far inland are at risk. Before the season ends, there will be property damage to homes and to our properties which serve as second homes.

If you happen to suffer damage to your property, either from wind or water damage or even hail, you actually have an opportunity.

You’re going to have to make arrangements, contacting insurers, adjusters, and contractors insurers, adjusters, and contractors.

But you should also contact GRP Capital.

If you have ever dreamed of renovation, the time when nature has done your demo work is actually ideal. Insurance will cover much of the cost of repairs, but you can also access additional modest financing to upgrade your property in ways that will make it more attractive to potential customers, allowing you to increase your revenue and your occupancy.

It’s counterintuitive to think about big dreams when recovering from damage, but do think beyond just repairing. What other upgrades to your property have you always wanted to take on, but you never had the time or the money to do so?

Downtime for part or all of your property is a good time to consider enhancing guest rooms, common areas, outdoor spaces, and even rebranding. If you are often at full capacity or run out of a certain type of room, this can also be a time to consider changing your room make-up or adding additional guest rooms.

Are you prepared for an emergency?

• Do all of your staff members know where to go and what to do if bad weather comes?
• Is your equipment in good working order? (Generators, fire extinguishers, flashlights)?
• Is your first aid kit filled?
• Do you have your insurance agent contact information handy?
• Do you have sufficient supplies if you have a surge in guests? Consider purchasing a double supply of bedding and towels, lots of non-perishables for breakfast and supplemental food to sell in the gift shop, including low-cost water.

Whether you are expanding your existing portfolio or investing in your first business, GRP Capital has the resources to help you meet your required capital needs. Our services include divisions of Real Estate Capital Markets, Small Business Financing, Construction Lending, GRP Capital Debt Fund, and Consulting and Advisory. Learn more at grpcapital.com.

We are a leader in commercial lending, advising, and investing because we are experienced, connected, and invested. Contact us to start the conversation.

Many businesses run on a fiscal year.

In the hospitality industry, even if your financial year is January to December, September offers a new beginning.

September is the beginning of school, the end of summer holidays and vacations. Owners and operators who travel themselves are often back at the desk and supervising properties again.

This new beginning offers you a chance to assess your business and set goals to improve.

Examine Your Financial Statements:

Your financial statements aren’t just a document for your accountant; they are a critical tool for you. Take a look at your financial statements and ask yourself the following questions:

• How profitable was my business this year?
• Are my revenues steady, increasing or decreasing?
• What has led to changes in revenue this year?
• Were there any expenses this year that were higher than normal? Why?
• Were my net profits the same, more or less than last year? Why?

Set Goals Based Upon Your Financial Statements:

Once you clearly understand your profit and loss reports, you can set clear goals. If you are going to increase revenue, what steps will you take? Will you work on increasing customers or occupancy, increasing rates, increasing menu prices, or sourcing new streams?

If you are trying to tackle expenses, determine which expenses are not fixed and then create a plan to lower them. Are you taking advantage of energy credits? Are your television and internet services economical, based upon how your customers and your staff utilize these services? What amenities on site are being utilized and which are idle?

Consider if your debt service is appropriate or if this is the time to refinance debt. GRP Capital is happy to assist you in assessing your debt load and determining if there are other ways to reduce the cost of your debt and increase profitability.

Think Big! 

September is a good time to consider taking appropriate risks.

• Is this the time to invest in a new property?
• Is this the time to upgrade properties you already have in order to attract more customers, obtain more revenue or garner better reviews?
• Is this the time to restructure debt?
• What experiments can you try to increase revenue, whether it’s a new marketing initiative or a new way to attract hotel guests?

Take advantage of this new beginning to examine the operation of your business, assess its health and weaknesses and set goals to improve in the future.