Texas Independent Hotel Refinance

Ryan Dumas’ client has an independent hotel in central Texas. The owner and her late husband had been operating the hotel for a number of years. They had a private mortgage and wanted to refinance to a more traditional mortgage. Independent hotels often face some barriers in securing financing. But our GRP Capital team was able to find a lender and secure an SBA 7a loan. Ryan was particularly pleased that this SBA loan closed in under 60 days. Truly, this was proof that quick closings can still occur with an SBA product!

Ryan described the closing, saying, “I enjoyed getting to know the owner and her son. They have been working together to maintain and market this independent hotel. I wanted to do everything I could to support these small business owners. They wanted stable, guaranteed funding. The SBA loan was the perfect vehicle for them.”

Special Considerations for an Independent Hotel:

• What are the benefits for keeping this as an independent hotel? Be prepared to show how this hotel operates without the benefit of franchises. Is your location so good, that you do not need the franchise support? How is this property marketed? What are the cost savings of staying independent?

• Hotel statistics: Independent hotels have to work harder to keep track of occupancy, average daily rate and revenue per average room. Be sure that the seller (if you are buying) or you (if you are refinancing) have accurate statistics. Lenders will also often request sales tax payments to verify occupancy statistics.

• To STR or not to STR? Lots of independent properties don’t subscribe to the Smith Travel Report (STR) system. But STR reports can be very helpful as you operate your hotel. You can compare your occupancy and average daily rate to your competitors. Consider if this information would help you in setting rates and making future business plans. It may be worth the money to subscribe, even for a short time.

• Why should I consider an SBA loan?:  Small Business Administration (SBA) loans are often the best matches. For instance, the SBA is willing to guarantee a larger variety of hospitality loans, including economy and mid-scale properties. And many lenders will not consider loans to independent hotels without the SBA guaranty.

• Explore your current lender’s options: If you already have an affordable mortgage, consider why you are interested in refinancing. We can help you determine the costs and the benefits of a new loan.

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, 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.