Access Point Financial Releases State of the Hotel Construction Loan Report

For best results when printing this announcement, please click on link below: Access Point Financial Releases State of the Hotel Construction Loan Report Article Provides Historic Overview, Current Events and Outlook for Hoteliers Access Point Financial (APF) today announced the release of a far-ranging hotel industry report targeting the construction loan sector. Entitled, “I Will Gladly Pay You Tuesday for a Hamburger Today: The State of Hotel Construction Loans,” the document provides a historic overview of hotel construction loans before delving into the current situation and outlining paths APF sees on the rise.

“With continual market fluctuations, economic uncertainties and rising costs, we wanted to provide hotel owners and developers with truly useful information to make future growth plans,” said Dana Tsakanikas, chief investment officer, APF. “While researching this project, we learned a few things ourselves. Hotel development remains sluggish nationwide, but we are seeing meaningful exceptions in certain segments and locations. ” The five-page report commences with a historic overview of hotel construction loans from the start of the 2000s, featuring a decade-by-decade recap of events.

“I Will Gladly Pay You Tuesday” then delves into a current review of market conditions before eventually making predictions and offering suggestions for tomorrow. Key Highlights With constantly rising costs, hotel developers today have shifted focus from ground-up development to “flips and PIPS,” investing in brand conversions and renovations to entice guests. “Like-new” comes with a lower price tag, as renovations bypass expensive construction loan costs required for new builds. Extended-stay products are an anomaly for new development, as owners appreciate lower operational overhead costs and resilient customer demand.

Record early-stage pipeline activity, particularly in luxury, reflects developers' response to the current undersupply. As of the close of the 2026 first quarter, the luxury hotel segment has 59 hotels currently under construction. S. 15% year-over-year.

Maddeningly for hoteliers, hotel-specific debt is meaningfully more expensive than other CRE asset classes. 30%) — and hotel construction/bridge financing runs materially higher still, roughly 8%—10%+ depending on structure and leverage. S. 5% as of early 2025, with rooms under construction still below pre-COVID levels.

That gap between the cost of building new hotels and acquiring existing ones has fueled a wave of M&A activity, as hotel companies increasingly expand through acquisitions and partnerships rather than new construction. However, that activity is proving to be an exercise in “testing the market,” as a material gap still exists between seller and buyer price expectations. Roughly $48 billion in CMBS-era hotel loans are maturing in 2025—2026, often refinancing at debt service ~40% higher than the original loan — which pulls lender and sponsor attention/capital toward rescuing existing assets rather than funding new construction.

Margins haven't recovered as much as revenue has, so even where ADR/RevPAR appears healthy, gross operating profit per room remains near 90% of 2019 levels — leaving a thin cushion to absorb higher construction and debt costs. Costs matter, but it's really a stack of cost-of-capital + tighter lender selectivity + margin compression, with construction/material cost inflation (Turner Index) as one input among several rather than the single cause. Already this year through the first two quarters, dollar volume for hotel loans rose 85% year-over-year in the first quarter and a further 19% year-over-year in the second quarter.

“Based on the success rate of our existing client activity of late, we remain bullish on the ‘Build, Baby, Build,’ strategy,” Tsakanikas noted. ” For a full copy of the report, please visit About Access Point Founded in 2011, Atlanta-based Access Point Financial (APF) is a multibillion-dollar real estate private credit firm focused on the hospitality industry, offering bespoke investment and direct financing solutions (senior debt, construction debt, mezzanine and preferred equity) to experienced hotel owners and franchisees of all major hospitality brands and independent boutique hotels throughout the United States. com) (703) 864-5553