Private Financing - only for short term? Angel Investor Networks?

[Sarah Present]

I'm trying to learn the private financing world due to a bump in the road on SBA loans right now. This aspect of investing is very new to me. This project entails 12 cabins in a mountain town that has a really nice tourist flow and offers a lot of outdoor activities.  The cabins are currently booked solid despite the Covid19 situation.  We had a 504 SBA loan in place and are under contract for the property, but after working with the lender for 2 1/2 months they all of a sudden slapped us with an email that they cannot approve any hospitality related loans.  Its a tough market right now, and understandably so, but we have a very solid business plan, and the existing business has been operating for 21 years successfully.  They are busier this summer than last summer.  We have data showing everything. We feel very good about this business.  We are having two other lenders review now but I have started to lose faith that despite my tireless efforts to show the obvious growth and potential we can bring with our business plan and endless data - these lenders may end up with the same result.

The sellers continue to urge us to find private financing.  I have not explored that in the past.  My current interpretation is that private financing is ultimately always hard lenders - is that a safe statement?  This deal was great because SBA literally was doing like a 3.5% interest, it was crazy good.  But its not even feasible to think about 6%-higher for any length of time.  And is also safe to say that people only use private financing when its super short term? (6 months or less?)?  We would have no guarantee in the short term with the way lenders are behaving.  

Ultimately, if we could find a financing alternative that was 5% for a good two years - we would be golden.  We could easily double the current owners revenues (they are super old school and ready to retire).  Is there such a thing?  Its overwhelming trying to learn about private financing because it seems you run into a lot of hard money lenders that charge very high interest which i assume would be a no brainer for a fix n flip, but not for this project.  

This is not just an emotionless investment, this is a passion project for sure, and the location is very good.  I am really trying to think outside the box here and the sellers seem irritated and impatient (they don't seem to understand the Covid19 effects, and blame everything on the SBA).  We've conveyed over and over, that the SBA is the only thing that has allowed lenders to even consider this at this time and they are not the problem.  Anyway, I digress, this is a passion project and something I would stay closely involved with.  I hope to move to the area when i'm lucky enough to retire from my day job and really feel strongly about this project.

I'm looking into angel investors too - however the networks i've looked at, show me there are a significant amount of terms i'd have to consider. And this leads to mounds of additional question like - would we need to somehow change our Articles of Org of our LLC if an angel investor were to be interested and receive revenue? If anyone has expertise in these areas (private financing, angel investing) as it relates to this situation I would be very interested in hearing from you. I'm considering even setting up a pitch for angel investor for just the down payment and operating costs - but again setting that up is something i've never been involved with and havent found any reliable resources that dig into these things.

Any suggestions?  Also the appraisal came in a little lower than the asking/offer price, and we are now definitely going to have to push out the closing date again, so its imperative that I find something that will work in order to get the sellers to sign with us again on a new contract which will be soon.

Just trying to keep a dream alive!  :)

Sarah