Hotel Project Financing - Equity Syndications Support

Rainmaker's hotel project financing program focuses on fractional real estate tenant-in-common ownership interests for syndications of $2,500,000 or more with each fractional unit contract being for $25,000.  Rainmaker provides due diligence services including project market feasibility studies, pro forma financial presentations, capital funding plan proposals, private placement offering related documentary disclosures and support.  Our goal is to provide enough at-risk equity contributions (from the fractional syndication) to allow the developer of the property to access a non-recourse hotel project financing program in the commercial bank markets or on the basis of a private placement offering.

Obviously, if a client intends to have Rainmaker undertake a syndication, then Rainmaker cannot provide the market feasibility analysis report because of a conflict-of-interest, but Rainmaker can pick up the ball once the market study is complete and run with it to the completion of the funding cycle.  Rainmaker can provide the continuity through to completion of the initial syndication marketing period (always 90 days) for most property types and assuming the developer demonstrates experience or obtains the necessary assistance to manage the project.  The keys to a successful hotel financing are:

• Development team.  Everyone should have a demonstrable track record for the management of all aspects of the property's development, construction, marketing and operating plans and financial matters.

• Due diligence documents.  Formal market feasibility study, financial feasibility study, business plans, lease memorandums, pre-sales agreements, proposed statutory investment entitlements and capital financing documents substantiating the project.  (Note the buttons on the navigation bar)

• Project funding plan.  The final consolidated financing plan based upon a pro forma financial presentation assuming the capital finance costs associated with the syndication that assumes a construction loan that is retired at end of construction by ongoing sales of fractional real estate interests.   Every successful syndication will be for at least 100 $25,000 and then will remain open as long as there is market interest, or; the syndication sells out 100% of the remaining fractional units, whichever occurs first.

• Differentiated Product.  There are enough solid franchise systems available to support a brand that is not otherwise already represented in the local marketing area of the subject property.

Rainmaker Marketing Corporation wants to support your commercial real estate development funding needs by providing an orderly market for the sale of real property interests that supplant the equity gap funding that has plagued commercial real estate developers of all sizes and product experience levels.  An orderly syndication market allows properties of all types to be more closely aligned to the expectations of the commercial real estate investor marketplace.  Rainmaker has set up an Internet portal for the purposes of supporting the market for both development funding as well as for relisting for the purposes of providing investors with a ready mechanism by which they can liquidate their holdings in a given enterprise (or group of enterprises) within an acceptable period of time.

If you are considering the development of a hospitality industry project, but have come up short on the required at-risk equity contributions required to obtain your construction mortgage loan, then you need to be talking to us about the alternatives.