Back in October of 2020, I provided an update on the lending climate during the pandemic.
There are no shortage of inn buyers or sellers these days. It’s almost as if the pandemic has placed an opportunity to hit the reset button, giving many a reality check of what’s important.
But are the banks lending? That’s the question on everyone’s mind.
I closed one inn in February this year. Then Covid hit. Three deals then fell through……then September into November I sold 3 more inns.
I have a list of hospitality lenders in Maine, but of that list, Machias Savings really seemed to be the one most interested in taking on new hospitality loans, whereas others were looking to wait until the first quarter of 2021, giving them time to assess the state of the industry a bit before jumping back into things. Many who already had portfolios saturated with hospitality loans were assisting their customers with their loans, forgiveness, PPP, etc.
As of this date, have a few more inns under contract due to close in the first quarter of 2021, but the banks are looking for buyers who are stronger financially and who have a background that can lend itself to the hospitality business. Depending on the financial performance of the inn, they are looking for a buyer to have enough liquidity to potentially cover up to 2 years of mortgage payments.
We are feeling optimistic as we head into 2021 with the much anticipated Covid vaccine and the strong tourism season we saw in the fall 2020.
FAST FORWARD TO DECEMBER 2021…
THE BANKS ARE DEFINITELY LENDING! As of December 31, 2021, I will have closed on 18 hospitality transactions – nearly all were financed, most utilizing SBA. Certain banks are still not as competitive as others, so it is imperative you contact me before going to your bank, to get the best terms!
Feel free to call or email me to discuss any of this in detail.