BANKS RETURN TO LENDING IN
WE ALSO EXPECT TO SEE STEADY GROWTH IN THE USE OF SUSTAINABLE FINANCING AMID A RISE IN CONSUMER AWARENESS REGARDING THE ENVIRONMENTAL AND SOCIAL IMPACT OF TRAVEL AND TOURISM .
– ANDREW MCCASKER
INVESTMENT
BANKS RETURN TO LENDING IN
ASIA PACIFIC
EXPECT THEIR APPETITE TO GROW AS THE INDUSTRY RECOVERY DRIVES INCREASED GEARING LEVELS AND TEMPERS THE RISK MARGINS BANKS ARE FORECASTING FROM TRANSACTIONS .
Contributed by STEVE CARROLL AND ANDREW MCCASKER , CBRE , SINGAPORE
Caution has prevailed for hotel lenders in Asia Pacific over the past two years , in a market hard hit by pandemic restrictions . But the goalposts are shifting in the region as the tourism industry rebounds , occupancy rates increase and RevPAR begins to climb .
Most banks and hotel funding partners have been supportive of the industry during the pandemic period , providing flexibility through interest payment holidays , working capital increases and a relaxation of covenant and reporting requirements .
This has resulted in limited defaults being recognized and a relatively low number of distressed sales . Hotel owners have also been supported by opportunities to serve as government-supported quarantine facilities , which has provided much needed cash flow .
Now , with the Asia Pacific market moving into recovery mode , and RevPAR improvements following trends seen in the United States and Europe , banks are selectively reentering the lending landscape .
We expect this appetite to grow as the industry recovery drives
38 hotelsmag . com June 2022