Hotel & Hospitality Financing

Between 10% and 40% depending on the program. SBA 504 and 7(a) can go as low as 10% for experienced owner-operators, though 15% to 20% is more typical on hotels since lenders treat them as special-purpose property. Conventional bank loans generally want 30% to 40%. CMBS expects 30% to 40%. Bridge lands in the 20% to 35% range. Layering C-PACE on qualifying energy work reduces the cash you bring to closing.

Yes. Accommodation and food services is consistently one of the largest sectors in SBA lending. Both SBA 504 and SBA 7(a) finance hotels and motels for owner-operators. The main eligibility test is that the property operates as a lodging business with the majority of guest stays under 30 days, and that you are actively involved in the operation rather than holding it as passive real estate.

7(a) is one loan from one lender and it can fund almost anything, including working capital and renovation, up to $5 million guaranteed. 504 is two loans, a conventional first mortgage plus a fixed-rate SBA debenture, and it is limited to fixed assets but delivers a 25 year fixed rate and no cap on total project size. If you need operating cash and renovation money, 7(a). If you want the lowest long-term fixed rate and the largest project, 504. Many hotel deals use both.

As of July 4, 2026, a single borrower can hold up to $10 million in combined SBA 7(a) and 504 exposure, double the prior $5 million cap. Because 504 pairs an uncapped bank first mortgage with the SBA debenture, total project cost on a 504 hotel deal can run past $20 million. Qualifying green projects carry additional capacity on top of that.

It is a lane within the SBA 504 program for projects that meet an energy public policy goal, which a hotel can hit by reducing energy consumption at least 10%, generating at least 15% of its energy from renewables, or using qualifying sustainable design. Green debentures go to $5.5 million per project and carry their own aggregate allowance separate from your standard SBA exposure, which means an owner who has already maxed out standard SBA capacity can keep acquiring. The job creation requirement is also generally waived. On a hotel with an HVAC or lighting-heavy renovation scope, this is often free capacity sitting on the table.

Yes. Under current SBA 504 refinance rules, a refinance can go up to 90% loan to value with or without cash out, and the old limit capping eligible business expenses at 20% of appraised value has been removed. Cash out proceeds have to go to eligible business expenses, which covers things like paying down a business line of credit, business credit cards, payroll, rent and future operating costs. Conventional and bridge lenders handle cash out with fewer restrictions but at lower leverage.

Yes, through bank construction facilities, debt fund construction loans, and SBA 504 on qualifying owner-operated projects. Expect 60% to 70% loan to cost, draw-based funding, and a lender that underwrites your permanent takeout as carefully as the construction budget. You will need entitlements, a signed or approved franchise application, a GMP contract and a general contractor with hotel experience.

680 is the common floor and the best terms go to sponsors above 720. On CMBS and other non-recourse debt, property cash flow and sponsor track record carry more weight than the personal score, but weak credit still narrows the lender list considerably.

Yes, if the file solves for it. Lenders want to see a third-party management company, a relevant operating background, or an experienced partner in the ownership group. First-time buyers who bring one of those three close deals regularly. First-time buyers who bring none of them get declined.

Four common paths. An SBA 7(a) facility can fund renovation alongside the acquisition in one loan. A bridge loan can carry a PIP holdback that funds by draw as work completes. C-PACE covers qualifying energy improvements such as HVAC, windows, lighting and envelope at up to 100% of that scope. And in some cases the existing lender will modify and advance. The right answer depends on your deadline and your exit.

Bridge closes fastest at roughly 14 to 45 days. Conventional bank runs 30 to 45 days. SBA 7(a) is typically 60 to 90 days. CMBS runs 60 to 90 days. SBA 504 usually needs 90 to 120 days. If your contract date does not fit the program you want, we structure a bridge now and a permanent refinance later.

Generally 1.35x to 1.40x on trailing twelve month performance, underwritten after a reserve for furniture, fixtures and equipment of roughly 4% to 5% of gross revenue. Stronger coverage buys leverage and better pricing. Thin coverage pushes the deal toward bridge capital or a smaller loan amount.

Yes. Independent properties price wider than branded ones because the lender loses the reservation system and the brand standard, but they get financed every day. Strong local demand generators, documented operating history and a credible management story do most of the work. Bridge capital is also the standard tool for financing a conversion to a flag.

Yes. Exterior corridor motels and roadside lodging are financeable through SBA and bridge capital, and they are often better SBA candidates than large full-service hotels because the loan sizes fit the program cleanly. The underwriting focus shifts to demand drivers, property condition and whether the operation is genuinely transient lodging rather than long-term residential.

Yes, primarily through CMBS conduit loans on stabilized flagged properties with solid trailing coverage. Expect a lockbox, cash management and defeasance or yield maintenance prepayment terms. You are trading operational flexibility for rate certainty and no personal guarantee. C-PACE is also non-recourse but covers only the energy portion of a project. SBA loans always require a personal guarantee.

Six to nine months out. That gives time to clean up the trailing twelves, resolve deferred maintenance, address any brand issues, and take the file to several lenders instead of accepting whatever your current bank offers in month eleven. Waiting until 90 days out is how borrowers end up in expensive extensions.

Yes. Portfolio and multi-property structures exist across conventional, bridge and CMBS. On the SBA side, the combined $10 million borrower limit is the constraint, which is exactly why the Green Project lane matters for owners building a portfolio. We map your remaining SBA capacity before structuring the next acquisition.

No. Commercial Capital Partners is a placement brokerage and advisory firm. We hold SBA Preferred Partner status and place your file across a network of more than 250 lenders, which means we work the whole market for you rather than fitting your deal into one institution’s box.