At Clopton Capital, we provide expert brokerage and advisory services to help sponsors and owner-operators secure hotel financing throughout the United Kingdom. From boutique hotels in Central London to regional hospitality portfolios and seaside resorts, we connect you with the right capital—ranging from high-street banks and institutional life companies to specialist debt funds and private equity.
Hotel financing is a specialized form of commercial real estate debt tailored to the unique operational risks of the hospitality sector. Unlike a standard office or industrial lease, hotel income is derived from “daily leases” (room nights), making the asset highly sensitive to seasonal trends, economic shifts, and management quality.
In the UK, lenders underwrite hotel loans based on EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) and key performance metrics such as RevPAR (Revenue Per Available Room) and ADR (Average Daily Rate).
Lenders categorise UK hotel assets into three primary groups:
Branded/Franchised: Hotels operating under a major flag (e.g., Hilton, Marriott, IHG). These often secure the most competitive rates due to brand-driven demand.
Independent: Unique, unbranded properties. Underwriting focuses heavily on the local market and the operator’s specific track record.
Managed: Hotels run by a third-party professional management company (White Label operators).
Purchasing a hotel requires a lender that understands the local “staycation” or business travel market. We source acquisition loans that account for both the real estate value and the business’s going-concern value.
If your current mortgage is maturing or you wish to extract equity for a PIP (Property Improvement Plan), our refinance programs offer fixed and floating options. We help you transition from expensive bridge debt into long-term institutional capital once the hotel has stabilized.
For hotels undergoing a major brand “re-flagging,” significant renovations, or those being converted from other asset classes, a hotel bridge loan provides the short-term liquidity needed to execute the business plan.
We provide ground-up hotel construction financing for new-build projects. These loans are typically structured based on Loan-to-Cost (LTC) and often include an interest reserve to cover debt service during the build and ramp-up periods.
Loan Size: £1,000,000 to £100,000,000+
Leverage: Up to 65%–70% LTV for senior debt; up to 80% total leverage with mezzanine.
Rates: Priced off SONIA (floating) or fixed-rate Gilt-linked swaps.
Amortisation: 20–25 years, with Interest-Only periods (often 1–3 years) during stabilisation.
Recourse: Non-recourse options available for established, branded assets with strong DSCR.
To provide an accurate term sheet, UK lenders typically require:
Trailing 3-Year P&L: Historical financial performance of the asset.
STR Reports: Benchmarking the hotel against its local competitive set.
The Business Plan: Details on any proposed renovations, brand changes, or management shifts.
Sponsor Bio: Your track record in the hospitality space and current liquidity.
An LLC owning a branded hotel in Manchester needed to perform a mandatory Property Improvement Plan (PIP) required by the franchisor. We arranged a £12 million refinance that paid off the existing debt and provided £3 million in cash-out proceeds for the renovations, all while keeping the loan non-recourse.
A partnership acquired an underperforming independent hotel in Cornwall with plans to turn it into a luxury boutique destination. We secured a 70% LTV bridge loan with 24 months of interest-only payments. Once the renovation was complete and the ADR increased, we transitioned them into a 10-year fixed-rate commercial mortgage.
A corporate group sought to refinance a hotel situated on a complex ground lease. We engaged a life insurance company experienced with long-dated UK ground leases to provide a £25 million, 10-year fixed-rate deal with competitive amortization.
Work with a specialist broker that understands the hospitality “cycle.” From acquisition to PIP and exit, we have the capital sources to keep your project moving.
Yes. While franchised hotels are often easier to finance, we have a network of specialist lenders who focus on high-performing independent boutique hotels across the UK.
Yes. We arrange hospitality financing for properties in London, major regional hubs, and seasonal tourist destinations throughout the UK.
Our programs generally start at £750,000, with our institutional and CMBS partners focusing on deals above £5 million.
We can typically provide initial lender feedback within 24–72 hours. A full closing usually takes 6–10 weeks depending on the complexity of the valuation and legal reports.
