Hotel & Motel Management - September 15, 2008 - (Page 50)

50 On The Block LENDING H&MM September 15, 2008 | HotelMotel.com www.HotelMotel.com/digital_edition Lending requires knowledge, preparation IN THE details Brokers help in process The lending environment has caused concern for many trying to buy and sell hotels, but sometimes a broker can help a deal close. Brokers’ knowledge and experience can help: Build relationships with lenders Understand parameters Prepare for process By Emily Hanna ASSOCIATE EDITOR HREC done deals Starkville Hotel Group I LLC acquired the 69-room Hampton Inn in Starkville, Miss., for an undisclosed amount. Hodges Ward Elliott Focused Service Division brokered the transaction for the seller, Starkville Investment Co. LLC. The hotel will remain a Hampton. T his year has brought many In today’s lending environment, capital still can be obtained—sometimes with the extra help of a broker. HREC– changes to the industry, Hospitality Real Estate Counselors helped close the sale of the St. Mary Lodge & Resort [above] in Glacier, Mont. notably to the lending In one transaction HWE for loans well over $20 million, environment. There is little capi- and make referrals, Cahill said. Brent Jaynes, director of bro- then you may have to deal with worked on this year, the Hamptal to be spread around, and deals are difﬁcult to close. Now, many kerage services and partner at Lei- what they call a ‘country club ton Inn in Sanford, N.C., sold for people seeking lending are turn- sure Real Estate Advisors, said he deal,’ where it may take two or about $7.6 million through assisevaluates the deal and buyer, and three lenders,” Cahill said. “This tance from the U.S. Small Busiing to brokers for assistance. “I would probably say two from there he sometimes makes is what’s changed with the whole ness Administration. In another, the Hampton Inn in years ago, when lending was very recommendations of lenders. “If subprime fallout over the Rock Hill, S.C., required free and open and availwe do, we make multiple past 12 months.” $17.6 million in ﬁnancBrokers also can be able, [a broker relationrecommendations and let ing. “As a result, smallship] was not as critithem make those contacts integral because they er banks or community and make their mind up understand what lendcal,” said Mike Cahill, ers’ parameters are. For banks couldn’t deal with president and founder on their own,” he said. that risk, so we were able of HREC–HospitaliSometimes, especially example, larger lendto bring in GE, and they ty Real Estate Counin today’s current econom- ers like GE Commerwere very, very creative selors. “But the good ic environment, certain cial Finance and North- Falor real estate brokers who transactions require lend- mark Bank have strict HODGES WARD ELLIOTT and got that deal done in a difﬁcult lending envido hotels have those re- Cahill ing from multiple sourc- limits as to what they are es. Although minimum willing to lend on, from geogra- ronment,” Falor said. lationships with lend- HREC Falor credits the success of numbers for seeking lend- phy restrictions to brand requireers so that now, when ing from more than one in- ments, said Anthony Falor, COO the transaction not only to GE, financing is incredistitution vary—some said of Hodges Ward Elliott’s Focused but also to the buyer’s ﬁnancial bly difﬁcult, they have strength—a major factor that brolook for it on deals of more Service Hotel Group. those referrals to buyers At HWE, about 80 percent kers note. Falor said HWE follows than $10 million, while to help them ﬁnance their assets.” others said lending can be of the deals closed this year in the a “qualiﬁcation process” to ﬁnanWell-connected obtained from one source limited-service division involved cially qualify the potential buyunless it’s more than $20 HWE brokers in the lending pro- er, including obtaining ﬁnancial brokers can then conmillion—all agreed that it cess, according to Falor. Of those, statements of involved partners tact various lenders can be necessary. 20 percent to 30 percent of the and getting references from prethey know to ﬁnd ac- Jaynes vious franchisors and brand con“As you start asking deals required multiple lenders. quisitions for buyers LEISURE REAL ESTATE tacts to check past relationships. Paperwork is another major requirement for lenders and brokers. “We make sure that the lender has everything they need in order to underwrite the transaction,” Rock Hill, S.C. Jaynes said. Catawba Hotel Associates LLC sold the Hampton Jaynes’ closing advice for buyInn Rock Hill (S.C.) to Rock South LLC. Hodges Ward ers hit a chord for the industry: Be Elliott’s Focused Service Division represented prepared. “Be prepared with your Catawba. The 162-room property will undergo a own materials, be prepared to ansigniﬁcant renovation and continue operating under swer more questions than ever with the Hampton Inn brand. this lending environment and be prepared to bring more equity.” ehanna@questex.com On behalf of Humble Hospitality LLC, Jones Lang LaSalle Hotels’ selectservice division sold the 107room Holiday Inn Express Hotel & Suites Jackson (Miss.) to Jackson Express Hotel Investment LLC. Lakeview Realty Trust sold the 79-room Sandy Bay Motor Inn in Rockport, Mass., to Local Yokel LLC for more than $2 million. Wason Associates Hospitality Real Estate Brokerage Group brokered the sale. Charles Burton Reid LLC sold the Baymont Inn & Suites in Richmond, Va., to Shiva P LLC for $5.8 million. Hospitality Consultants negotiated the sale. Jones Lang LaSalle Hotels represented Strategic Hotels & Resorts in the sale of the 696-room Hyatt Regency Phoenix to DiNapoli Capital Partners for $96 million. Fort Collins Diamond Hotel Corp. acquired the 66-room Quality Inn & Suites in Fort Collins, Colo., for $3 million. Hodges Ward Elliott Focused Service Division brokered the transaction for the seller, CHA Ft. Collins LLC. Hodges Ward Elliott brokered the sales of the Rockland Radisson Hotel and the Milford Sheraton Hotel. Both properties are in Massachusetts and were sold to Linchris Hotel Corp. on behalf of Ashford Hospitality Trust. Compiled by Emily Hanna, ehanna@questex.com HWE http://HotelMotel.com http://www.HotelMotel.com/digital_edition

Table of Contents Feed for the Digital Edition of Hotel & Motel Management - September 15, 2008

Hotel & Motel Management - September 15, 2008 Contents Microtel, Hawthorn Settle in at Wyndham Is it Black or Red for Green Hotels? New City on the Strip When in Doubt, Purchase some Seashells Legal FAQ Consultant's Corner Sales Clinic On Finance Travel Trends Franchise Law Guest Column Events Cornell Insights HotelWorld Update Trends & Stats Top Hotel Companies Survey Awards Lending Requires Knowledge, Preparation Casegoods Minibars Historian to Keynote Leadership Forum at IH/M&RS Fitness Equipment The Lodging Conference Preview Accent Lighting Awards Vacuums Supplier News Transactions People Ad/Editorial Index Marketplace Classifieds Checking Out

Hotel & Motel Management - September 15, 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.