There is increasing concern that the lack of available financing will be a major problem in 2012 for commercial properties whose loans are maturing. The problem appears to be especially acute for hotels as they have about $21.7 billion of mortgage-backed securities on 232 hotels that will need to be refinanced over the next year. Some knowledgeable people in the hotel industry believe that maybe as few as one third of the loans that need to be rolled over will find financing.
There is little money available to finance the construction of new hotels right now. Lenders don't want to get into this space when everyone is anticipating a large number of hotel properties to be foreclosed. Although capitalization rates on hotels as well as other commercial property types have fallen recently, it will take some time to see if we actually get a double top in Rates. Limited service hotels in marginal locations have been hit the hardest in the hotel motel space.
I have worked property tax appeals on hotels for many years. There is room for negotiation on the assessor's values even if capitalization rates are down this year compared to last. County appraisers are often undereducated on allocating a portion of the income stream to personal property as well as deducting for personal property replacement. Business startup costs are another expense item that can be used to account for the specialized personnel that work in a hotel and the technology and training that is needed. If you need professional assistance with your hotel property tax appeal, please contact us.
There is little money available to finance the construction of new hotels right now. Lenders don't want to get into this space when everyone is anticipating a large number of hotel properties to be foreclosed. Although capitalization rates on hotels as well as other commercial property types have fallen recently, it will take some time to see if we actually get a double top in Rates. Limited service hotels in marginal locations have been hit the hardest in the hotel motel space.
I have worked property tax appeals on hotels for many years. There is room for negotiation on the assessor's values even if capitalization rates are down this year compared to last. County appraisers are often undereducated on allocating a portion of the income stream to personal property as well as deducting for personal property replacement. Business startup costs are another expense item that can be used to account for the specialized personnel that work in a hotel and the technology and training that is needed. If you need professional assistance with your hotel property tax appeal, please contact us.
