Lender Guidance Plan

for CMBS Hotel Borrowers

Following multiple calls with the major Special Servicers to discuss current economic circumstances and their response specifically to the hospitality sector, we are providing insight to help you understand their position.

We learned Servicers are presently looking to form task forces to create a pragmatic, systemic approach in light of the COVID-19 impact. As such, Master Servicers may be granted “temporary expanded authority” on decisions generally requiring Special Servicer approval. 

If you can answer YES to any of the following:

___ I am a hotel owner that may have a temporary cash-flow issue due to the negative economic impact of COVID-19.  

___ I may not be able to make one or more of my mortgage payments in 2020, resulting in a monetary default.

___ I may not be able to refinance my hotel at loan maturity.

___ I am currently or expect to be (next 6 months) in discussions with my hotel’s franchisor re: flag extension or PIP projects or validity of flag, if my property shutters temporarily.

Then think about strategizing your next steps and be prepared to:

●  Sign a PNL (Pre-Negotiation Letter). 

●  Make reasonable Lender requests and document those requests via a written plan.

●  Have completed the following documents: Current Financials / STR Reports / Guarantor Financials / 30/60/90 Financial Projections / Reforecast Budgets. 

●  Have already spoken with your Franchisor and have a sense of how they’ll respond to your situation. Will they pull the flag? Will they extend a flag without the PIP funding in place?

●  Convince the Lender of your Credibility and Commitment to your Property. 

●  Be buttoned up in order to avoid being weeded out.

With a heavy caseload anticipated, we believe preparedness is the strongest tool in your arsenal to ensure you can get a Special Servicer’s attention and priority processing.

CONTACT US today to discuss how we can help.