Hotel & Motel Management - June 16, 2008 - (Page 46) 46 News H&MM June 16, 2008 | HotelMotel.com www.HotelMotel.com/digital_edition Lenders Continued from page 1 ity Group, was able to put together this conference during times of uncertainty proved there are financial organizations ready and willing to deal in hotel capital. “These are the people who are telling us they’re here and they’re providing capital for the industry now,” Butler said. Meet the Money included the traditional industry update, and Smith Travel Research’s senior v.p. Bobby Bowers analyzed supply and demand predictions for the remainder of the year. Bowers predicted that many flash-inthe-pan development projects will soon drop out of the pipeline because of a lack of funding and therefore room growth—or supply—will not be off the charts. “Obviously a slower economy means a slower room demand growth and we’ll have to see how Woodworth PKF HOSPITALITY Bowers STR the economy plays out for the balance of the year,” he said. “But a lot of the data that we’ve looked at up until now [shows] that the top markets will probably outperform some of the secondary and tertiary markets.” Bowers suggested advances in revenue management, including managing booking at third-party Web sites, will help hoteliers ride out the current downturn better than in 2001. Mark Woodworth, president of PKF Hospitality Research, said the beginning of 2010 is when the key industry numbers—supply/ Show me the money If you’re looking for lodging industry capital, here are some lenders and a brief description of projects that representatives said they specialize in: Rockbridge Capital—Willing to lend anywhere in the capital stack Berkshire Capital Financial—Lending primarily in $10-million to $30-million range GE Real Estate— Construction loans in limited-service market Textron Financial—$10million to $30-million senior secured debt, generally midscale to luxury JF Capital Advisors— Investing in participation in larger deals; minimal lending Perry Capital—Lending across all markets Source: JMBM Meet the Money “Who’s funding now?” panel 14th Annual Camp Lodging Tuesday – Friday, September 23-26, 2008 The Arizona Biltmore Resort and Spa Phoenix, AZ WELCOME TO Register: 800-252-3540 or www.lodgingconference.com The Leading Industry Event for Hotel Developers Camp was never like this before ® demand and average daily rate— will start to look significantly positive again. “What we see is a very, very mild downturn relative to what we saw during the last two economic recessions,” Woodworth said. “While the economy might be in a recession, the lodging industry certainly is not.” One Meet the Money panel, “Who’s funding now?” featured six representatives from financial organizations who said their companies are actively lending and discussed what type of projects they are targeting. The consensus was that debt today is more expensive than it was during the peak, but that isn’t necessarily a bad thing. Only borrowers with a solid plan will do the extra work to find the capital, said Jonathan Falik, c.e.o., JF Capital Advisors. As far as new-build projects, lenders were nearly as optimistic, echoing the statement that more equity will be needed to find construction loans. “They must have a significant portion of the capital stack, and if they can get the flag to put in some skin as well, that essentially puts us over the hump right now,” said Jed Richardson, director, Scotia Capital. jfreed@questex.com CIRCLE NO. 120 http://HotelMotel.com http://www.HotelMotel.com/digital_edition http://www.lodgingconference.com http://www.lodgingconference.com
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