Tag Archives: Florida hotel

college football stadium

Fast Closing for North Florida Hotel

Our clients wanted to purchase a Florida hotel, but only with a fast closing. The hotel was in a college town and they wanted to capitalize on as much of the football season as they could. Adding to the challenge was a looming government shutdown, which would affect the approval of any government-guaranteed loans.

Krishan Patel, GRP Capital Managing Director, worked closely with the clients and the GRP Capital team to find an appropriate lender and loan product. Krishan noted that “Like many of our clients, this group of partners wanted a fast closing. However, what really helped was the preparedness of the clients and the hard work of our GRP Capital staff. In addition, the borrowers had engaged a strong team of professionals to help with legal work, including negotiations with franchise. All of these elements were critical to actually achieving a fast closing.”

Must Haves for a Fast Closing:

  • The right type of project. Construction loans can take longer to underwrite, as can complicated businesses. This loan was for the purchase of an existing hotel with clear, reliable statistics about previous performance. Thus, a fast closing was a doable proposition.
  • Type of loan matters, too. A fast closing can be possible for a bridge loan. However, SBA loans can sometimes take longer to underwrite. Understand that lenders and agencies’ timelines may lead the process.
  • Responsiveness to lender’s requests. Lenders typically ask for personal financial statements and often proof of global cash flow for guarantors. Be prepared to provide those documents. It is also reasonable for lenders to request tax transcripts, which confirm the accuracy of submitted tax returns. Submitting these documents quickly and cheerfully is the best way to demonstrate good will and trustworthiness.
  • Financials and other documents to show previous income and expenses. These can include detailed financial statements (Profit & Loss statements as well as balance sheets), sales tax bills, STR reports (for hotels), as well as any in-house statistics. If you are refinancing a loan, then you should accumulate these documents, with the help of a trusted accountant, if necessary. If you are purchasing a business, the seller or the broker should be able to provide these documents.
  • Accurate and thoughtful business plans and projections. Spend some time at the beginning of the loan process creating a strong business plan. This should include not only your projections for future income and expenses. It should also include your ideas for operating and managing the business, including marketing, personnel, financial management and maintenance.
  • Engage competent professionals right away. Engage an attorney, even before signing a purchase-sale agreement. Tell your accountant of your loan process, and that you may need more recent financials. If you have had a good experience with a title company in the past, make plans to use them again. If you need a survey, get right on that, as these can take some time.

Need more information on creating a strong business plan?

Why Choose GRP Capital?

Our GRP Capital team specializes in crafting financing solutions tailored to each client’s unique goals.

Whether you’re purchasing, refinancing, renovating or building from the ground up, our extensive network of lenders ensures you’ll find funding that aligns with your goals and cash flow needs.

Here’s what sets us apart:

  • We save you time by researching and identifying the best funding options for your project.
  • Our expertise spans various loan products—including non-recourse loans, SBA loans, bridge loans, and conventional financing—so you can navigate even the most complex transactions confidently.
  • Beyond lending, we provide strategic guidance on operational decisions that drive long-term business success.

Orlando skyline

Bridge Financing for Orlando Hotel

An Orlando client faced a serious loan concern and needed immediate bridge financing. His loan was facing a maturity and the current lender was not interested in refinancing.

Rick Patel, GRP Capital President noted, “Several of our recent hospitality clients are experiencing similar circumstances. The hospitality lending scene is changing and constricting actually. Lenders’ appetite for hospitality is shifting. Certain lenders’ “hospitality buckets” are filling quickly while other lenders are showing greater interest in hospitality. What we provide for our clients, including this one, is industry knowledge. That means we know which lenders to turn to for financing, including bridge financing.”

The bridge financing paid off the previous loan and also provided some needed working capital.

Bridge Financing Basics

  • A bridge loan creates a bridge between a project that requires funds and the necessary financing.
  • Bridge financing is temporary.
  • Obtaining a bridge loan allows the loan to close quickly; therefore you can create the time you need to secure permanent financing solutions.
  • These interim loans often have short term higher interest rates. The borrower understands this is the cost of interim funding.

Reasons for Bridge Financing:

  • Need for immediate closing due to seller demands.
  • Lender Dropout! The lender stops the process during underwriting, putting the entire loan in jeopardy.
  • Quick closing requirements, as buyer wants to use 1031 funds.
  • Buyer demand: The buyer has to have this property and it has to close now! Sometimes our clients will see an underperforming property that has just come on the market. Or they have had their eye on a competing business and knew they wanted to purchase it if it were for sale. These buyers are seriously motivated!
  • Competitive bidding: sellers will often entertain multiple bids from multiple buyers. Being able to close quickly may seal the deal.
  • Our clients may want to use SBA (Small Business Association) guaranteed loans or HUD (Housing and Urban Development) loans or Department of Agriculture loans (for rural properties). These government backed loans take a little longer to close. Clients who use bridge lending can close quickly and then refinance the loan through these agencies.
  • Businesses that need to stabilize. We have many clients who are very talented owners and managers. But new businesses can be risky and lenders can be risk-averse. If borrowers take possession of a business, turn it around and stabilize it, their business can be more attractive to lenders in the near future.

Why Choose GRP Capital?

Our GRP Capital team specializes in crafting financing solutions tailored to each client’s unique goals.

Whether you’re purchasing, refinancing, renovating or building from the ground up, our extensive network of lenders ensures you’ll find funding that aligns with your goals and cash flow needs.

Here’s what sets us apart:

  • We save you time by researching and identifying the best funding options for your project.
  • Our expertise spans various loan products—including non-recourse loans, SBA loans, bridge loans, and conventional financing—so you can navigate even the most complex transactions confidently.
  • Beyond lending, we provide strategic guidance on operational decisions that drive long-term business success.

Bridge Financing for Large Hospitality Loan

Our long-time clients had a vision for a Gulf Coast hotel. They knew that they would require a large hospitality loan. Securing financing in the hospitality industry has become a little more difficult. As a result, they depended on GRP Capital to do the research to find an appropriate lending partner.

This hotel property shows great promise as it is situated near a brand new planned exit ramp. In addition, the borrowers had detailed plans to create a dual brand flagged hotel. After renovations, floors would alternate between traditional guest rooms and suites. This will provide two price points and two unique choices for travelers and guests. At the same time, the hotel would be utilizing the same staff and management company.

The bridge financing will provide resources for the full renovation and allow time for the borrowers to execute on their business plan. In addition, this will give the partners time to stabilize the asset and secure permanent financing.

Rick Patel, GRP Capital President, commented, “This $12.5 million loan showcased our GRP Capital teams’s ability to handle and close a large hospitality loan. We found a new to us lender in our network. This lender had the appetite for a large hospitality loan. They worked closely with our team and the borrowers to understand their vision and fund it.”

Bridge loans, including large loans such as this, are great options for financing, especially during the current government shutdown. Diversifying your portfolio from smaller SBA-guaranteed loans to a larger hotel or a more premium class one can be a very positive business decision for savvy entrepreneurs. 

If you are interested in non-SBA loans, particularly bridge loans, reach out to our team right away. 

Renovation Funding Basics:

• Secure a general contractor if one will be needed. Many lenders require general contractors for large renovations, particularly if there will be architectural changes. Even if you have reliable maintenance staff who can handle large jobs, you may still need to bring in a GC.

• Stay on top of budgeting. If your loan will include renovations, the lender needs many details. Most importantly, they need the components of the renovation broken down by line item, materials and labor. And if this changes through the underwriting process, the budget has to be revised.

• Determine down time:  Will renovations affect your business? Will you be able to have customers or will you be partially open for business? Be sure that your financial projections and your timeline are clear, so the lenders can build in interest free periods while you are not taking in revenue.

More information on Bridge Financing

Why Choose GRP Capital?

Our GRP Capital team specializes in crafting financing solutions tailored to each client’s unique goals.

Whether you’re purchasing, refinancing, renovating or building from the ground up, our extensive network of lenders ensures you’ll find funding that aligns with your goals and cash flow needs.

Here’s what sets us apart:

  • We save you time by researching and identifying the best funding options for your project.
  • Our expertise spans various loan products—including non-recourse loans, SBA loans, bridge loans, and conventional financing—so you can navigate even the most complex transactions confidently.
  • Beyond lending, we provide strategic guidance on operational decisions that drive long-term business success.

First Time Owner Buys Florida Hotel

Our client was ready to be a first time owner of a hotel.

He had already successfully owned and operated several fast casual restaurants. Now he was ready for the challenge and the potential opportunity of a Florida hotel.

Our client had been looking for properties in the west coast of Florida for a while. He knows that market well and it is close to where he lives. He was keeping his eye on several hotels that were rumored to be going on the market. When they became available, with our advice, he made a competitive bid which was accepted. Now, he just had to close by the seller’s timeframe.

A first time owner needs a little more attention. Rick Patel and Krishan Patel worked closely with the client, along with Keren Alpert, our loan processor. We advised him on setting up his corporation. We recommended that he bring in an experienced minor partner, at least at the beginning. We also were a resource in engaging legal counsel and insurance.

The partnership group coalesced and the loan closed. Our client told us, “Thank your team for all the help during the process”. His hotel is ready for the Florida high season.

Tips for First Time Owners:

• Stay within your budget. Just because you are ready to take on this new challenge, don’t feel pressured to spend more than you are able to. As exciting as new ownership is, affordable ownership is your goal.

• Engage your attorney and accountant. First time owners are wise to assemble a team of professionals in addition to utilizing your GRP team. Do not try to save money by serving as your own attorney or accountant. Accountants needs to be on board to provide monthly updated financial reports for any businesses you own. Lawyers can help you in negotiating with the seller (and their lawyer), as well as prepare and review documents and make any necessary changes to agreements.

• Start working on obtaining insurance right away! Obtaining insurance is not super fast for new properties, especially in certain coastal areas. Particularly if you require flood insurance, begin that process as soon as your PSA (purchase sale agreement) is signed. Sometimes you may also need life insurance either because you are a key employee, or because of a collateral shortfall. It can take weeks to obtain the life insurance policy and assignment, so begin that process right away as well.

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 or purchase, 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.

All Weather Focus: Loan Closing No Matter What

Sometimes a loan closing poses unexpected challenges.

Our Florida-based clients were used to Florida weather.

But they weren’t counting on a hurricane during the underwriting process.

GRP Capital stayed focused during the entire loan process , as loan closing was the key to this refinance and partnership buyout.

As it turned out, the property had minimal damage and only suffered from some short-term power outages. The storm, however, delayed the appraisal and Environmental Site Assessment (ESA) reporting. When there are large storms, appraisers and environmental engineers are in high demand.

GRP Capital stayed in touch with the lender, the clients and all of the third party vendors to make sure everybody prioritized this closure.

GRP Capital President Rick Patel worked closely with the clients and the other stakeholders, too. Rick noted, “This loan closing was very important to the client partners. The ownership of the hotel had changed and we needed new financing with correct guarantors. With our guidance, the loan closed in a reasonable time, despite rather challenging circumstances in the region.”

What to do if your Property Has Damage from a storm?

• Communicate with your lender or ask GRP Capital to: Lenders and borrowers are not adversaries, but business partners in a way. Lenders deserve to know if your business has sustained damage, which will affect your bottom line. Lenders can be your advocates. Helpful lenders can suspend payments, extend a loan or even restructure a loan to include repairs that won’t be covered by insurance.

•  Combine storm damage repair with a PIP:  Believe it or not, storm damage can actually be an opportunity. If you have always wanted some renovation, consider the timing. Renovating during repairs might save you money. .

•  Hire an attorney: An attorney can work with your insurance company to protect your interests. He or she will also review any contracts. Most importantly, attorneys will remove any liens that are placed on your property during the repair 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 for purchase, refinance and construction loans. Our experience allows our clients to find funding that is project-appropriate and will allow for sufficient cash flow. If you are considering becoming a first-time (or second or third time!) buyer, we can assist you.

Florida Beach Hotel Loan Closes

Our clients were looking for a Florida beach hotel. When this one came on the market, they were ready to pounce. The hotel is on a small island with very few other hotels in direct competition. The clients have retained the current management. However, they have set up new incentives in order to increase occupancy and garner even better online reviews.

GRP Capital President Rick Patel worked closely with the buyers, as well as many other participants in the loan process. These included the insurance agent, the accountant and the various attorneys. Rick stated, “This hotel was a high value property because of its position in a limited marketplace and its potential for profit. With these larger transactions, there are even more details that we needed to be on top of. I was proud of our team for closing the loan as quickly as possible, locking in the interest rate. I know our clients are happy with their new business and are ready to capitalize on their acquisition.”

Issues Unique to Beach Hotel Loans

• Staffing and management : Some beach properties are far from affordable housing and some are not. Be aware that you will have to find staff who can afford to live within commuting distance. Some business owners are even reserving housing for key staff members as an added benefit.

•  What’s the insurance claim history of the property?  Many coastal properties have a history of moderate or even significant damage from storms and flooding. Find out about any recent insurance claims. Make contact with the current insurance agent to obtain a quote and compare that with any from an agent you are currently using. Make sure you factor in the insurance costs when you are evaluating financial statements and expenses.

•  What happens during the off season? Many properties with high tourist occupancy have a high season and a low season. What is the occupancy “out of season”? What can be done to increase occupancy and maintain ADR?

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 for purchase, refinance and construction loans. Our experience allows our clients to find funding that is project-appropriate and will allow for sufficient cash flow. If you are considering becoming a first-time (or second or third time!) buyer, we can assist you.