Atlanta-based Access Point Financial Provides Quick Recovery Capital to Affected Properties in Disaster-Stricken Areas

May 9, 2018

Brian A. Lee

Friday, April 13th, 2018

‘Always look for the helpers’ was a mother’s comforting advice to her son when disaster struck. Hotel owner-operators can now do the same with a financial friend and its quick and customized recovery capital program.

“We find ways to lighten the burden of hotel developers and owner-operators who need to reestablish their assets, whether a complete rebuild or minor rehabilitation, and get back in the marketplace as soon as possible,” said Jon Wright, chairman and CEO of Atlanta-based Access Point Financial, Inc. “We commit to creative loan structuring for these folks so they don’t have undue burdens above and beyond what they’ve already incurred.”

Fast, good and economical: The business world says one can only pick two out of the three, but Wright, a more than 25-year hotel lending veteran who has successfully navigated the savings and loan crisis, Great Recession and other downturns, is here to right that rule. For nearly three decades, Access Point Financial has put expertise before expediency and partnership before profit in the middle market hotel lending space.

APF offers to affected parties six to 12 months of no payments and 18 months of interest-only payments — rates stay in the standard 7 to 9 percent range — for loans typically ranging between $50,000 and $15 million (the lender’s normal operating range is $250,000 to $25 million). The recovery capital program has been especially well-received by select-service assets in tertiary markets. APF expects to furnish $100 million in recovery capital proceeds within six to eight months.

“We’re offering this type of program because it’s economically feasible for us with our cost of capital and our ability to delay payments,” said the man who founded the Asset Backed Lending Group for GMAC Commercial Mortgage and managed the hospitality industry’s first captive finance division for InterContinental Hotels Group. “We have the scale of operation and the resume to conduct this type of business, as well as very, very close relationships with many of primary and long-term players in the hospitality industry over the last 30 years. They are family to us. We’re able to assist with granular attentiveness so they can get back to the macro operations of their hotels.”

Harvey, Irma & Wildfires — Oh My!

Houston, we have a problem, and Access Point Financial has a solution. The effects of Hurricane Harvey on Houston’s hospitality industry extend from property damage to lost jobs, canceled future bookings and more. Like a bridge over troubled waters comes welcome financial relief for hotel owner-operators from hurricane-ravaged Texas and Florida to wherever the next natural disaster may occur.

“When these storms come in – fires, storms, whatever act of God – we’ve always been in place to provide customized financing solutions, to provide loan modifications where they are needed,” said Wright. “It’s one thing when you have to manage delinquent borrowers, but again we’re talking about relieving the burden of good operators in bad, often very challenging situations.”

The numbers are staggering, that is if a hotel owner has time to look up from his or her own personal house of pain. Hurricane Harvey, which flooded extensive sections of the nation’s fifth largest MSA in August, could ultimately cost between $70 billion and $190 billion, the latter estimate equivalent to the combined toll of Hurricanes Katrina and Sandy and representing a 1 percent hit on the national economy.

Delayed payments and other financial concessions can go a long way when hotels are picking up the pieces after a storm. In most instances, owner-operators are having to play the waiting game as well – waiting on insurance proceeds and other reimbursements after such destructive, naturally occurring events make life and business anything but normal.

Wright said that despite many hotel owner-operators having very well-defined disaster recovery programs, covering both their general operations and information technology platforms, a big storm still presents major challenges, especially a one in a thousand-year cataclysm like Hurricane Harvey.

“As owner-operators, it’s obviously the bulk of their livelihood,” Wright said. “In most [disaster] instances, it’s then the panic button.”

Based on conversations and interviews with clients and their support network, including insurance companies, APF provides a delayed payment program of 12 to 18 months and/or interest-only options to help alleviate the major concerns about getting back to business and reviving their asset performance. With so much to worry about, from their personal lives to their business assets, owner-operators can breathe easier at the end of the month through the period of time required to achieve reconciliation with their insurance claims and other reimbursements.

“On occasion, the loan will not represent the requested return on equity for us per se,” Wright said. “We target a minimum ROE just like a hotel developer does. In these specific cases though, we’ve been willing to forgo the typical policy we have internally for goodwill and demonstrating our community involvement and ability to act charitably where we can.”

In these types of situations, APF will bypass its ROE modeling in favor of longer-term scenarios that take into account relationships. Without the people that are so adversely affected – from owners to general managers down to housekeeping and all who support a hotel’s different revenue streams – nothing would be possible anyway.

“That’s where we feel like we can add value in a charitable sense,” Wright said. “We certainly do not go broke in conducting this business, but I can say that we are definitely not in profit mode when we’re making these loans. Nothing is more deeply gratifying as that act of goodwill.”

Returns: Property, People & Investment

Access Point Financial’s track record of timely support and relationship-building goes a long way back, through good times and bad. After Hurricane Irene struck the North Carolina coast in 2011, the damaged former Sheraton in Atlantic Beach was left in a liquidity lurch. Despite making the repairs necessary to reopen, the owner ultimately could not survive the financial hit of extended closure as subsequent occupancy rates proved insufficient to avoid foreclosure with the original lender.

The new owner paid all cash for the nine-story property with plans to renovate the hotel and convert it to a full-service, 200-room DoubleTree by Hilton. Access Point Financial not only spearheaded the refinancing so the owner could redeploy rehab capital to other needs, it also provided the capital for the renovation and conversion.

Within 10 days of application, the direct lender was able to structure bridge financing to facilitate cash flow. The DoubleTree by Hilton Hotel Atlantic Beach Oceanfront reopened in 2013 with an extensive array of amenities, and the owner was able to refinance the property at a lower interest rate at loan proceeds 37 percent higher because of the resulting enhanced revenue performance.

Beware & Be Good

In high-stress situations similar to the aftermath of a hurricane, hotel owner-operators may be susceptible to predatory lenders. With so many challenges surrounding the asset’s recovery, it might be tempting to jump at a seemingly easy financing offer. Wright says beware.

“Borrowers need to be on very high alert as to who they’re dealing with, who they’re borrowing money from,” he added. “It is not at all uncommon for lenders to fly their banner and gladly take loan applications. However, it’s also not uncommon to find out they’re really injecting capital under false pretense with the objective of taking back the property or at the very least taking over management of the asset.”

Proper borrower due diligence on lenders will highlight an industry veteran like APF that has made approximately $7 billion of loans with no more than 1 percent in past-due delinquencies. It should also reveal the alternative.

“If it’s too good to be true, it might well be,” Wright said. “Comparing a lender’s rate is not always the bellwether for doing business with somebody. Dive deep into their history and their track record. There’s more predatory behavior out there, especially since the recovery.”

That means a lot more when it comes from a company committed to relationships. Every lender can model their business via commodity and overall portfolio ROE, but few focus on community commitment like APF, as proven by its long-term charitable commitments, seasonal payment offerings and now its recovery capital program. “Let’s rebuild together” is more than just a tagline for the hotel lender and partner.

Source: http://metroatlantaceo.com/news/2018/04/atlanta-based-access-point-financial-provides-quick-recovery-capital-affected-properties-disaster-stricken-areas/

S.B. Yen gets $90M construction loan for South Loop hotel project

May 7, 2018

A South Loop hotel project that’s been in the works for more than two years just got a $90 million shot in the arm.

Hinsdale-based S.B. Yen Management Group received a construction loan from Access Point Financial, according to Cook County records.

Plans for the two-tower hotel development at 1101 South Wabash Avenue call for a total of 281 hotel rooms. The project would also include about 3,500 square-feet of ground-floor retail, as Curbed has reported.

Work on the project began in 2017 with the demolition of a parking garage that had been on the property.

The site will be developed as-of-right and won’t need any special zoning changes.

The South Loop is in the midst of a development boom that includes high-profile projects like the 76-story, 792-unit One Grant Park; Essex on the Park, a 56-story, 479-unit rental tower; and a 74-story, 323-unit condo tower known as 1000M at 1000 South Michigan Avenue.

source: https://therealdeal.com/chicago/2018/04/23/s-b-yen-gets-90m-construction-loan-for-south-loop-hotel-project/

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Catherine Laws
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Atlanta-based Access Point Financial Provides Quick Recovery Capital to Affected Properties in Disaster-Stricken Areas

May 9, 2018

Brian A. Lee

Friday, April 13th, 2018

‘Always look for the helpers’ was a mother’s comforting advice to her son when disaster struck. Hotel owner-operators can now do the same with a financial friend and its quick and customized recovery capital program.

“We find ways to lighten the burden of hotel developers and owner-operators who need to reestablish their assets, whether a complete rebuild or minor rehabilitation, and get back in the marketplace as soon as possible,” said Jon Wright, chairman and CEO of Atlanta-based Access Point Financial, Inc. “We commit to creative loan structuring for these folks so they don’t have undue burdens above and beyond what they’ve already incurred.”

Fast, good and economical: The business world says one can only pick two out of the three, but Wright, a more than 25-year hotel lending veteran who has successfully navigated the savings and loan crisis, Great Recession and other downturns, is here to right that rule. For nearly three decades, Access Point Financial has put expertise before expediency and partnership before profit in the middle market hotel lending space.

APF offers to affected parties six to 12 months of no payments and 18 months of interest-only payments — rates stay in the standard 7 to 9 percent range — for loans typically ranging between $50,000 and $15 million (the lender’s normal operating range is $250,000 to $25 million). The recovery capital program has been especially well-received by select-service assets in tertiary markets. APF expects to furnish $100 million in recovery capital proceeds within six to eight months.

“We’re offering this type of program because it’s economically feasible for us with our cost of capital and our ability to delay payments,” said the man who founded the Asset Backed Lending Group for GMAC Commercial Mortgage and managed the hospitality industry’s first captive finance division for InterContinental Hotels Group. “We have the scale of operation and the resume to conduct this type of business, as well as very, very close relationships with many of primary and long-term players in the hospitality industry over the last 30 years. They are family to us. We’re able to assist with granular attentiveness so they can get back to the macro operations of their hotels.”

Harvey, Irma & Wildfires — Oh My!

Houston, we have a problem, and Access Point Financial has a solution. The effects of Hurricane Harvey on Houston’s hospitality industry extend from property damage to lost jobs, canceled future bookings and more. Like a bridge over troubled waters comes welcome financial relief for hotel owner-operators from hurricane-ravaged Texas and Florida to wherever the next natural disaster may occur.

“When these storms come in – fires, storms, whatever act of God – we’ve always been in place to provide customized financing solutions, to provide loan modifications where they are needed,” said Wright. “It’s one thing when you have to manage delinquent borrowers, but again we’re talking about relieving the burden of good operators in bad, often very challenging situations.”

The numbers are staggering, that is if a hotel owner has time to look up from his or her own personal house of pain. Hurricane Harvey, which flooded extensive sections of the nation’s fifth largest MSA in August, could ultimately cost between $70 billion and $190 billion, the latter estimate equivalent to the combined toll of Hurricanes Katrina and Sandy and representing a 1 percent hit on the national economy.

Delayed payments and other financial concessions can go a long way when hotels are picking up the pieces after a storm. In most instances, owner-operators are having to play the waiting game as well – waiting on insurance proceeds and other reimbursements after such destructive, naturally occurring events make life and business anything but normal.

Wright said that despite many hotel owner-operators having very well-defined disaster recovery programs, covering both their general operations and information technology platforms, a big storm still presents major challenges, especially a one in a thousand-year cataclysm like Hurricane Harvey.

“As owner-operators, it’s obviously the bulk of their livelihood,” Wright said. “In most [disaster] instances, it’s then the panic button.”

Based on conversations and interviews with clients and their support network, including insurance companies, APF provides a delayed payment program of 12 to 18 months and/or interest-only options to help alleviate the major concerns about getting back to business and reviving their asset performance. With so much to worry about, from their personal lives to their business assets, owner-operators can breathe easier at the end of the month through the period of time required to achieve reconciliation with their insurance claims and other reimbursements.

“On occasion, the loan will not represent the requested return on equity for us per se,” Wright said. “We target a minimum ROE just like a hotel developer does. In these specific cases though, we’ve been willing to forgo the typical policy we have internally for goodwill and demonstrating our community involvement and ability to act charitably where we can.”

In these types of situations, APF will bypass its ROE modeling in favor of longer-term scenarios that take into account relationships. Without the people that are so adversely affected – from owners to general managers down to housekeeping and all who support a hotel’s different revenue streams – nothing would be possible anyway.

“That’s where we feel like we can add value in a charitable sense,” Wright said. “We certainly do not go broke in conducting this business, but I can say that we are definitely not in profit mode when we’re making these loans. Nothing is more deeply gratifying as that act of goodwill.”

Returns: Property, People & Investment

Access Point Financial’s track record of timely support and relationship-building goes a long way back, through good times and bad. After Hurricane Irene struck the North Carolina coast in 2011, the damaged former Sheraton in Atlantic Beach was left in a liquidity lurch. Despite making the repairs necessary to reopen, the owner ultimately could not survive the financial hit of extended closure as subsequent occupancy rates proved insufficient to avoid foreclosure with the original lender.

The new owner paid all cash for the nine-story property with plans to renovate the hotel and convert it to a full-service, 200-room DoubleTree by Hilton. Access Point Financial not only spearheaded the refinancing so the owner could redeploy rehab capital to other needs, it also provided the capital for the renovation and conversion.

Within 10 days of application, the direct lender was able to structure bridge financing to facilitate cash flow. The DoubleTree by Hilton Hotel Atlantic Beach Oceanfront reopened in 2013 with an extensive array of amenities, and the owner was able to refinance the property at a lower interest rate at loan proceeds 37 percent higher because of the resulting enhanced revenue performance.

Beware & Be Good

In high-stress situations similar to the aftermath of a hurricane, hotel owner-operators may be susceptible to predatory lenders. With so many challenges surrounding the asset’s recovery, it might be tempting to jump at a seemingly easy financing offer. Wright says beware.

“Borrowers need to be on very high alert as to who they’re dealing with, who they’re borrowing money from,” he added. “It is not at all uncommon for lenders to fly their banner and gladly take loan applications. However, it’s also not uncommon to find out they’re really injecting capital under false pretense with the objective of taking back the property or at the very least taking over management of the asset.”

Proper borrower due diligence on lenders will highlight an industry veteran like APF that has made approximately $7 billion of loans with no more than 1 percent in past-due delinquencies. It should also reveal the alternative.

“If it’s too good to be true, it might well be,” Wright said. “Comparing a lender’s rate is not always the bellwether for doing business with somebody. Dive deep into their history and their track record. There’s more predatory behavior out there, especially since the recovery.”

That means a lot more when it comes from a company committed to relationships. Every lender can model their business via commodity and overall portfolio ROE, but few focus on community commitment like APF, as proven by its long-term charitable commitments, seasonal payment offerings and now its recovery capital program. “Let’s rebuild together” is more than just a tagline for the hotel lender and partner.

Source: http://metroatlantaceo.com/news/2018/04/atlanta-based-access-point-financial-provides-quick-recovery-capital-affected-properties-disaster-stricken-areas/