This means that many hospitality properties need to refinance their debt at significantly higher rates in an environment where local and regional lenders have been pulling back.In this podcast with CEO Greg Friedman of Peachtree Group, a private debt and hospitality private equity firm, he states that many hotel projects got shelved during the pandemic and that is bringing on an undersupply situation for hotel properties. 

In this discussion, we all agreed that for one property unit, the expected rate will be 10% and then it can decrease as the client adds more units or volume.

With interest rates so low we have refinanced into several 15 year mortgages with the goal of quickly paying down/off a few properties.

Alternatively recognize the challenges of being cash neutral at high LTV, the benefits of no longer paying a LL rent, that rates may lower such that you can refi, that over long term there will be appreciation and rent growth so it will at some point have positive cash flow, etc and lower your initial goal of cash neutral. 

When you sell the house the buyers financing or cash deal will cover your debts via title transfer 

Rates range from 8.75-9.2% but I know you'd need more information.  

Wisdom is knowing which is which.We do something a little bit differently, we buy "off market" and take over thier loan & we expect to get low interest rates and equity up front like this.

Cash Plan to refinance when rates are more favorable How did you add value to the deal?

Loan should be CTC within a week of contract and investors enjoying the property and filing their STR permit application for Summer..Rate on a 30 year fixed was in the high 6%'s...big job's report tomorrow that could accelerate rate cuts..stay tuned! 

I have noticed a lot of institutional shops and real estate private equity firms will factor in SOFR rates into their analysis.