Short answer
Lenders evaluate franchise consent for the change of ownership, PIP scope and budget, and operator track record alongside property fundamentals, hotels are operating businesses and lender diligence reflects that.
What franchise issues arise?
Most flag-affiliated hotels require franchise consent on transfer. The franchise issues a PIP defining required investment in the next 24 to 36 months, typically several million dollars on a mid-size full-service property. Bridge lenders require PIP funding to be reserved or a clear path to fund it before stabilization.
Sources
- Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations · Mortgage Bankers Association · 2026-Q1
- Financial Stability Report · Board of Governors of the Federal Reserve System · 2025-11