While the “extend and pretend” strategy on loan repayments and extensions was alive and well in 2020 and 2021, lender sentiment seems to have shifted a bit.
Owners may now need to find capital sources to refinance their maturing commercial mortgage-backed securities loans.
About $15 billion in hotel CMBS loans are coming due in the next two years. Owners may find that short-term bridge financing is available, but for a higher price than in the previous decade.
Where that's not an option, owners may find the need to shed non-core assets to save the rest of their hotel portfolios.
This could lead to transaction activity, but because debt and equity sources for acquisitions are plentiful, severe price discounts on hotels may still not materialize.