Financing The Pinetree taught me that a strong hotel concept does not automatically mean easy financing. Today, I begin lender conversations earlier, pay much more attention to realistic closing timelines, and treat financing as part of the investment strategy from the beginning.

When we bought The Pinetree Hotel in Idyllwild, California, I expected the renovation and operations to be difficult. What I underestimated was the financing. We fell out of financing twice and ultimately worked through three different lenders during the SBA process. The property was performing, but our independent, experiential hotel model did not fit neatly into the way many traditional hospitality lenders evaluate properties.

Why Our Hotel Was Harder to Finance

The Pinetree was not a traditional flagged hotel with years of standardized operating history. We were creating demand through amenities, social media, direct bookings, and group stays.

The previous owners were generating roughly $100,000 per year in revenue, and after repositioning the property, we increased revenue significantly and were on pace for roughly ten times that amount. Even with stronger performance, lenders still had to understand a business model that looked different from the conventional hospitality assets they were accustomed to financing.

Start the Financing Conversation Earlier

That experience changed when I begin talking to lenders.

Today, I want those conversations happening before a property is under contract. I want to understand how the lender evaluates the asset, what information they will need, what could affect the loan proceeds, and how realistic the closing timeline is. A lender saying they like a deal is helpful, but that is very different from having financing that can actually close.

Certainty Matters as Much as the Interest Rate

The lowest interest rate does not necessarily make a loan the best financing option. If the lender cannot close when you need them to, the consequences can affect the entire project.

Financing delays can push back construction, opening dates, revenue, contractor schedules, and investor expectations. I now pay much more attention to certainty of execution instead of evaluating financing only by the headline terms.

A Stronger Operating Model Can Help the Financing Story

As the hotel develops a track record, the financing conversation can become easier. At The Pinetree, group bookings for weddings, retreats, birthdays, and other events can be secured months in advance with deposits. Direct bookings also reduce our dependence on online travel agencies and allow us to retain more of the revenue. Those factors give lenders actual operating performance and greater visibility into future revenue instead of asking them to rely entirely on projections.

Financing Is Part of the Investment Strategy

Falling out of financing twice was frustrating, but it became one of the most valuable lessons from our first boutique hotel. I no longer treat financing as something to figure out after finding a good property. The property, operating plan, capital structure, and financing timeline all need to work together. A strong hotel opportunity still needs financing that gives the team enough time and flexibility to execute the business plan.