Building your dream home is one thing, but building a hotel from the ground up is an entirely different venture. The construction of a hotel takes time, money, and knowledge. We have an in-house construction team that works with our borrowers daily to help establish their businesses.Discover Live Oak Bank's 5 tips for a simpler hotel construction process Click To Tweet
To better understand the process, we asked a member of Live Oak Bank’s construction team to elaborate on considerations a borrower should keep in mind. Each of these points is vital to the operation and successful construction of a new hotel.
- Make sure you trust and are comfortable with all vendors-Having an open relationship with your vendor will guarantee a smoother transaction.
- Be aware of your budget at all times-Having a plan and sticking to it is critical to ensuring success. Know what you are paying and how often.
- Monitor construction when you can-Do you have a direct contact on the construction team? What phase of construction are you in and are you meeting your deadlines? Knowing the answers to these questions will keep the process advancing.
- Make sure your contractors carry general liability insurance-This will help negate any glitches and avoid possible lawsuits.
- Anticipate working capital needs and budget accordingly– Knowing your operation cycle by analyzing inventory, accounts receivable, and accounts payable each month will help you stay on track with your budget to meet the needs of your business.