How Matthews™ Unlocked LifeCo Capital for a Small-Market Hotel

Opportunity

Matthews™ Capital Markets was engaged to secure competitive financing for a Hampton Inn & Suites located in Adairsville, GA. The borrower sought to refinance the property following a property improvement plan (PIP). The deal presented a unique set of structural hurdles including a small balance loan under $10 million and a tertiary market location well outside a Top 25 metro area. This is a profile that most Life Insurance Companies (LifeCos) are unwilling to entertain.

 

The borrower’s priorities were clear: best-in-class pricing, ease of execution, flexible and non-restrictive terms, and low closings cost. This was in addition to the property still being in the process of restabilizing after its PIP.

 

Strategy

Recognizing that conventional LifeCos appetite for deals of this size and geography is limited, Matthews™ took a relationship-driven approach. Rather than a mass-market process, Vice President & Director, Luke Thompson, worked closely with a LifeCo correspondent partner to fully underwrite the story. This meant building a high-quality loan package that thoughtfully addressed the tertiary market dynamics and evaluated sponsorship in a way that gave the lender confidence in an asset outside their typical geographic comfort zone.

 

A full competitive process was run to identify the best rate and loan structure that aligned with the borrower’s business plan, with a particular focus on eliminating friction at every stage of execution.

 

Result

The resulting LifeCo loan carried no origination fees, minimal recourse, and capped legal and closing costs under $10,000. There were no attorney opinion letters, zoning letters, restrictions, or covenants. This lean efficient structure was made possible through Matthews’™ in-house servicing platform and correspondent relationships.

 

Matthews™ Capital Markets successfully closed the loan for the property, delivering the pricing, terms, and seamless execution the borrower required. This transaction demonstrates Matthews’™ ability to bring institutional LifeCo capital to small-balance, tertiary-market hotel assets, a segment routinely overlooked by most lenders.

 

Beyond closing, Matthews™ continues to service the loan through its proprietary platform, providing the borrower with an ongoing relationship and streamlined asset management experience.