Seeking $300K for Boutique Hotel Downpayment by Feb 9 - Collateral & Equity Offered

[Joe Shields]

I am currently working on acquiring a commercial vacation rental property, which I plan to transform into an 18-suite boutique hotel, complete with a public bar/restaurant and a pool. However, I'm facing a shortfall: I need an additional $300,000 for the down payment due to a delay in cash-out refinancing on three of my properties. These refinances won't close until February 23rd, unfortunately after the purchase deadline of February 9th. Ideally, I would need the cash for only 14-15 days, though I am open to longer terms if more favorable for the investor/lender.

To finance this acquisition, I've already secured a loan at 70% LTV and plan to contribute $500,000 of my personal funds towards the down payment. To make the deal more attractive, I am willing to offer a first position if the lender/investor can ensure closure by February 9th. The property is valued at $3,000,000 but is under contract for $2,500,000, providing instant equity of $500,000 upon closing.

I am actively exploring ways to quickly secure the required $300,000 and am considering various strategies, including negotiating with lenders or partnering with an investor. Additionally, I am prepared to offer either a first position on the loan or cross-collateralize with my portfolio of seven vacation rentals, valued at approximately $12 million, with $6.5 million in available equity and generating $1.4 million annually in gross rents.

Given the potential of this project, combined with my experience and the collateral available, I seek advice on approaching potential lenders or investors and effectively negotiating terms within such tight time constraints. Any insights, experiences, or contacts you could share would be immensely valuable.

[Don Konipol]

Quote from @Joe Shields:

I am wcurrently working on acquiring a commercial vacation rental property, which I plan to transform into an 18-suite boutique hotel, complete with a public bar/restaurant and a pool. However, I'm facing a shortfall: I need an additional $300,000 for the down payment due to a delay in cash-out refinancing on three of my properties. These refinances won't close until February 23rd, unfortunately after the purchase deadline of February 9th. Ideally, I would need the cash for only 14-15 days, though I am open to longer terms if more favorable for the investor/lender.

To finance this acquisition, I've already secured a loan at 70% LTV and plan to contribute $500,000 of my personal funds towards the down payment. To make the deal more attractive, I am willing to offer a first position if the lender/investor can ensure closure by February 9th. The property is valued at $3,000,000 but is under contract for $2,500,000, providing instant equity of $500,000 upon closing.

I am actively exploring ways to quickly secure the required $300,000 and am considering various strategies, including negotiating with lenders or partnering with an investor. Additionally, I am prepared to offer either a first position on the loan or cross-collateralize with my portfolio of seven vacation rentals, valued at approximately $12 million, with $6.5 million in available equity and generating $1.4 million annually in gross rents.

Given the potential of this project, combined with my experience and the collateral available, I seek advice on approaching potential lenders or investors and effectively negotiating terms within such tight time constraints. Any insights, experiences, or contacts you could share would be immensely valuable.

How are you offering a first lien?  Isn’t the 70% loan taking first position?