As hoteliers across the UK prepare to re-open amid signs of surging demand for “staycations”, financing for hotels and other hospitality venues continues to show strong signs of revival.
A survey by hotel finance specialists, Rangewell, showed that the number of finance providers offering loans to the hospitality sector has more than doubled since June 2020 with many more lenders anticipating re-entering the sector within the next month once lockdown formally ends.
Vinod Sherigar, Director of Funding at Rangewell, commented “We’ve seen a real resurgence of demand from leaders looking to lend to the hotel and hospitality sector – a number of businesses we’ve been working with over the last six months and who had been turned down for finance prior to Christmas are now in a situation where they have two or more lenders willing to offer terms and, in some cases, competing with each other to “win the business”.”
Importantly, hoteliers should be aware that a number of lenders are still offering hospitality loans under the Coronavirus Business Interruption Loan Scheme where all fees and interest payments are paid by the scheme for the first 12 months – making it an extremely attractive offering for businesses wanting to conserve cashflow as they reopen their business.
Vinod Sherigar noted, “We would strongly encourage hoteliers and others in the hospitality sector to take advantage of the CBIL Scheme – it closes very shortly at the end of March but there is still time to apply – you can do so right up until the deadline day.
Even if you have previously been turned down by your main bank, appetite from other specialist lenders has substantially increased. As an example, at Rangewell, we recently completed a CBIL transaction for a hotelier who had been turned down by his High Street bank, where we managed to refinance his current £1.4m loan and raise a further £400,000 for property improvements – all at no cost to the hotelier for the first 12 months due to the CBIL Scheme covering all fees and interest payments.”