Remedy For Distressed Hotels to Salvage Commercial Real Estate Market

It is estimated that $300 billion worth of commercial real estate loans needs to be refinanced each year until 2015. The struggling market is especially reflected in the hotel industry. The delinquency rate on CMBS lodging loans 30 days or more past due is 14.6%, or 21% of all delinquencies across property types. This represents $13.3 billion in delinquent hotel loans. In addition there are another $4.4 billion in lodging loans that are in special servicing programs.

The economic pressures in the hotel and lodging industry are experiencing stem from the slowdown in tourism. Consumers are traveling and spending less these days, which is having a direct negative impact on the revenue streams for resorts, hotels, and motels. As unemployment levels seem to be ever increasing the future of the travel and tourism industry are on a steady slope downwards.

Unflagged (independently owned) hotels are having even more difficulty. Many lenders do not lend as willingly to unflagged hotels as they do to franchise hotels. The inability for hoteliers to refinance for liquidity, or in anticipation of balloon payments poses a threat to the stability of the economy. A commercial loan restructure may be the only option.

Hotels must deal with this dilemma head on. Revenue streams are falling but fixed costs and mortgage loans payments still need to be paid. Cred Advise, Inc. offers programs to address at risk and troubled assets. Cred Advise has successfully restructured hundreds of commercial loans.

By restructuring mortgage notes hotels can hedge against lower monthly incomes. Cred Advise gives hotels and other lodging facilities the opportunity to apportion costs and become profitable again. Through commercial loan restructuring programs lodging establishments have an opportunity to be brought current on arrears payments as well as lower interest rates to reduce monthly mortgage payments.

The forecasted economic trends predict a slow down in the world economy for the next several years. Whether a hotel is in default of its mortgage now or not, planning for the future is a must. The demand for commercial loan restructuring is a relatively new phenomenon so if you are seeking help from a professional, be sure to work an experienced firm.  Cred Advise, Inc. can help create a plan for financial stability going forward.

For more information on commercial loan restructuring for hotels and lodging, or any other financial service please visit www.CredAdvise.com

For media inquiries contact Michael Carbonara at MichaelC@CredAdvise.com