Hotel and Hospitality Loans: Refinance Your Commercial Property | RefiLoop

Hotel and hospitality financing is one of the most specialized categories in commercial real estate — lenders evaluate these properties differently from any other asset class, using revenue-per-available-room (RevPAR), daily rate (ADR), and franchise agreements rather than traditional NOI. Whether you’re refinancing a limited-service hotel, a full-service property, or an extended-stay facility, RefiLoop connects you with hospitality-experienced lenders from our 7,000+ lender network. Get 3-5 competing offers in 48 hours.

Why Hotels Are Financed Differently

Unlike office buildings or retail centers with long-term leases, hotels operate as going-concern businesses. Revenue fluctuates daily based on occupancy and room rates. This volatility means lenders use specialized underwriting metrics:

• RevPAR (Revenue Per Available Room) — Total room revenue divided by total available rooms. The primary performance metric.
• ADR (Average Daily Rate) — Average realized room rental per occupied day.
• Occupancy rate — Utilization rate of the property. Seasonal fluctuations matter.
• Franchise agreement strength — Flags (Marriott, Hilton, IHG, Wyndham) significantly affect lender appetite.
• P&L statements (last 3 years) — Lenders scrutinize department-level profitability: rooms, F&B, meeting space.
• Net Operating Income after franchise fees and reserves — The base for DSCR calculation.

Hotel Financing Challenges We Solve

Post-Pandemic Performance Recovery

Many hotels saw revenue drops of 40-70% during 2020-2021. While most markets have recovered to or exceeded pre-pandemic RevPAR, some properties are still rebuilding. Lenders evaluate trailing 12-month performance alongside 3-year historical averages. We help position your recovery story effectively.

PIP (Property Improvement Plan) Requirements

Franchisors frequently require Property Improvement Plans — mandatory renovations and upgrades to maintain brand standards. These can cost $10,000-$30,000 per key. Lenders factor PIP obligations into their underwriting. RefiLoop helps structure financing that includes PIP funding — often through bridge loans or construction-to-perm programs.

Franchise Agreement Expiration or Re-flagging

If your franchise agreement is expiring within the loan term, lenders view this as heightened risk — re-flagging can disrupt revenue. We connect you with lenders who understand franchise renewal processes and can underwrite through the transition.

Seasonal Cash Flow Management

Resort and leisure hotels with strong seasonality need financing structures that account for revenue peaks and valleys. Interest-only periods during off-season months or flexible DSCR calculations are tools we deploy on your behalf.

Hotel Loan Programs Available Through RefiLoop

CMBS / Conduit Loans for Hotels

CMBS is one of the largest sources of hotel financing. Non-recourse, fixed-rate, 5/7/10-year terms on 25-30 year amortization. LTV up to 70%. Minimum loan size typically $2M. Best for stabilized properties with strong RevPAR and established franchise affiliation.

SBA 504 / 7(a) for Owner-Operated Hotels

For owner-operators, SBA programs offer up to 90% LTV (504) or up to $5M (7a) with below-market fixed rates. Owner must occupy at least 51% of the property. Strong option for limited-service hotels and independent properties.

Bridge Loans for Value-Add or Re-flagging

Short-term financing (1-3 years) for PIP completion, franchise conversion, or performance improvement. Higher rates but fast closing (2-3 weeks). Typically SOFR + 400-600bps. Up to 80% LTV. Bridge to permanent refinance once stabilized.

Agency / Government Hotel Programs

SBA 504, USDA for rural properties, and select state-level programs offer favorable terms for qualifying hotels. RefiLoop identifies all applicable programs for your property.

Debt Funds and Private Capital

For properties that don’t fit CMBS or agency boxes — performance-challenged hotels, independent (unflagged) properties, or properties in transition. Higher rates but more flexible underwriting on NOI, DSCR, and LTV.

How to Prepare for a Hotel Refinance

• Gather 3 years of franchise P&L statements — Lenders want the uniform franchise-issued statements, not just tax returns.
• Compile a trailing 12-month operating statement — The most recent 12 months carry heavy weight.
• Document RevPAR, ADR, and occupancy trends — Show the recovery/growth narrative.
• Identify your PIP status — Completed, in progress, or upcoming. Know the cost estimate.
• Review your franchise agreement — Remaining term, renewal options, termination rights.
• Order a current STR report — Competitive set performance data that lenders require.

How RefiLoop Helps Hotel Owners

RefiLoop has relationships with hospitality-specialized lenders that general commercial brokers don’t access. We understand franchise P&Ls, STR reports, PIP requirements, and the unique underwriting approaches each lender uses for hotels. We translate your property’s story into terms lenders respond to.

Schedule a free 15-minute review and we’ll assess your hotel refinancing options across our lender network.

Frequently Asked Questions

Can I refinance an independent (unflagged) hotel?

Yes, but your options are narrower. CMBS lenders strongly prefer flagged properties. Bridge lenders, debt funds, and some community banks will finance independents if the performance supports it.

What RevPAR do I need to qualify?

It varies by market and property type. Lenders compare your RevPAR to the competitive set (STR data). Outperforming your comp set by 10%+ opens most lending options.

How does a PIP affect my refinancing?

Lenders will require that PIPs be completed or funded. We can structure financing that includes PIP funding through a bridge-to-perm structure: bridge loan covers PIP, then refinance to permanent once complete.