Eric Jacobs, chief development officer of select-service and extended-stay hotels in North America for Marriott International, echoed Fortier’s advice and told the audience that if they are looking to sign a franchise agreement, they have to come to the table prepared. “The hotel business is cool, it’s fun to be in, but if you don’t have the capital and you don’t have a lender, the discussion falls apart pretty quickly,” he said.
To help prospective hotel owners better understand financing, a panel of experts walked attendees through potential sources for stacking their capital structures to make them more attractive to banks and lenders. Neil Freeman, chairman and CEO of Aries Capital, explained the benefits of the New Market Tax Credit program, which was established as a federal program to spur revitalization efforts in low-income and impoverished communities. “New market tax credits can be 10 to 20 percent of your capital stack,” he said. “When you combine that with something like historic tax credits, your returns are much stronger.”
Other financial tips included taking advantage of the EB-5 program, which, although time consuming to achieve, can help hoteliers who are developing new projects with a big economic impact and job creation benefits in their communities. Panelists also highlighted several brand incentive programs designed to help owners raise equity for projects with certain flags or for development in specific markets.
But the biggest takeaway from the four-day event tied directly to this year’s conference theme of “Networking–Connect for a Lifetime.” Partnership, connection, and friendship were all overarching touch points, with top-level executives and experienced owners stressing the value of working together.
“Don’t try to do everything yourself,” said Fortier. “Find people to supplement your weaknesses and get a couple of partners that can help you build an organization.”
“Hospitality is a great field,” added Ingraham. “And as we build this industry, we are going to build it together.”