Case Study
Hospitality Turnaround
advancedHospitality (branded hotel)Bridge-to-permanent~22 min
The Deal
You are the originator underwriting a bridge loan for Riverside Suites, a 120-key branded hotel that has fallen out of compliance with its franchise's brand standards. The franchisor has issued a Property Improvement Plan (PIP) that must be completed within 18 months or the property risks losing its flag, and the sponsor is asking your lender to fund the PIP, refinance the existing acquisition loan, and carry the hotel through renovation and lease-up until it stabilizes and can be refinanced with permanent debt.
You’ll Practice
- Calculate hotel NOI from occupancy, ADR, and RevPAR-based revenue
- Identify a franchise/PIP compliance issue as a financing red flag
- Size a bridge loan against total project cost (debt payoff, PIP budget, reserves, fees)
- Calculate going-in DSCR on an interest-only bridge loan
- Evaluate execution and demand risk in a hotel renovation business plan