09 Jun WHERE TO FROM HERE FOR HOSPITALITY?

Posted at 10:34h in covid-19-coronavirus by

While top line metrics are trending upward, the post-pandemic recovery has not touched all hospitality product types or markets. Timing pressure from loan maturities and impending rate cap renewals, coupled with decreased international travel demand, shifts in business travel behavior, and depleted cap ex reserves may result in distressed situations for certain assets.

Arcturus is actively working with hotel owners, operators and lenders to help assess the impact of these unprecedented pressures on their properties and collateral. This includes helping clients evaluate all aspects of property operations, identify strategies to limit near term operating losses, minimize capital expenditures, adjust sales and marketing plans, and best position properties to preserve value and capitalize on future market recovery. Arcturus offers comprehensive and hands-on asset management services to guide capital stack, operations, and cap ex strategies.

KEY HOSPITALITY ISSUES TO CONSIDER

Hotel ownership issues include:

  • Possible loan default (debt servicing or loan maturity)
  • Interest rate cap renewals
  • Approaching fund maturity dates pressuring investment decisions
  • Capital stack restructuring
  • Operating plan evaluation and reforecasting
  • Asset valuation
  • Capital needs assessment (PIP extensions/repositioning)
  • Investor & lender communication (rescue capital, forbearance, using other reserves for debt service)
  • Brand/management evaluation and restructuring
  • Insurance claim administration (including business interruption)
  • Hotel asset management (inclusive of F&B)
  • Employee and union contract issues
  • Audit and renegotiation of property-level contracts

Arcturus understands the critical issues facing hotel owners/operators caused by today’s unique environment. We have a highly skilled team of hotel professionals with deep experience helping clients to maximize the operating performance and preserve the value of their properties through past down cycles.

Please contact Arcturus so we can help you best navigate present market stresses and position your property for future success.