Hotel loan rates in 2026 sit higher than pre-pandemic benchmarks and reflect a lending market that has repriced hospitality risk significantly. Lenders who pulled back from hotels in 2020–2021 have returned selectively, favoring stabilized assets with strong RevPAR in demand-driven markets. This guide covers where rates stand across every hospitality loan type in 2026.
Updated November 2026. Rate ranges are typical market quotes and move with Treasury and SOFR benchmarks. Your pricing depends on leverage, property type, and sponsor experience.
2026 Hospitality Lending Rate Environment
After the dramatic pullback of 2020–2022, hotel lending has largely recovered in markets with strong RevPAR fundamentals. Lenders have returned to stabilized leisure, drive-to, and select-service hospitality assets. However, the lending community remains selective:
- Urban full-service hotels still face limited lender appetite following slow recovery from remote work and business travel disruption
- Drive-to leisure markets (mountain, beach, lake) command the tightest spreads
- Extended-stay and limited-service hotels are actively sought by both banks and private lenders
- SOFR-based floating rates have compressed the spread between private and bank hospitality lending compared to 2020–2022
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Hotel Loan Rates by Type (2026)
| Loan Type | Rate Range | Structure | LTV/LTC | Term |
|---|---|---|---|---|
| Permanent (stabilized, bank) | 7.00% – 8.75% | Fixed or floating | 55–65% | 5–10 years |
| Permanent (CMBS) | 7.25% – 8.50% | Fixed | 55–65% | 5–10 years |
| Bridge (stabilized) | 9.00% – 11.50% | Floating (SOFR+) | 60–70% | 12–36 months |
| Bridge (value-add / renovation) | 10.00% – 12.50% | Floating | 60–70% of cost | 12–36 months |
| Construction (ground-up) | 9.50% – 13.00% | Floating | 55–70% LTC | 18–36 months |
| SBA 7(a) (acquisition) | 9.50% – 11.50% | Variable (Prime+) | Up to 90% | 25 years |
| SBA 504 (owner-occ) | 6.00% – 7.50% | Fixed (CDC) | Up to 90% | 20–25 years |
| Hard Money (distressed/bridge) | 11.00% – 14.00% | Floating | 50–65% | 12–24 months |
Rates as of Q2 2026. Rates vary by hotel quality, market, LTV, borrower experience, and flag/brand status.
What Drives Hotel Loan Rates
RevPAR (Revenue Per Available Room)
The single most important metric in hotel underwriting. Strong RevPAR relative to the competitive set demonstrates market penetration. Lenders compare the subject property’s RevPAR to market RevPAR (RevPAR Index or MPI, Market Penetration Index). Properties with MPI above 100% (capturing more than fair market share) get tighter spreads.
Hotel Type and Flag
Flagged properties with national brands price tighter than independent hotels. Extended-stay and select-service properties price better than full-service and resorts due to lower operating leverage and more predictable income streams.
Market Type
Drive-to leisure markets (Florida beaches, mountain resorts, lake destinations) price better than gateway urban markets in 2026. Business travel hasn’t fully recovered in all urban markets, and lenders continue to be selective about major city center full-service properties.
DSCR
Hospitality lenders typically require higher DSCR thresholds than other asset classes, often 1.40x–1.50x, because hotel income volatility demands more coverage cushion. A hotel barely clearing 1.20x DSCR will face either a declined loan or pricing 75–150 bps higher than a property at 1.50x.
Occupancy Trend
Trailing 12-month occupancy trending upward gets better terms than a declining occupancy trend, even if absolute occupancy is similar. Lenders are underwriting forward-looking performance; momentum matters.
Rates by Hotel Asset Type (2026)
| Hotel Type | Permanent Rate | Bridge Rate | Lender Appetite |
|---|---|---|---|
| Extended-Stay (national brand) | 7.00% – 8.25% | 9.00% – 10.50% | Very High |
| Limited-Service (national brand) | 7.25% – 8.50% | 9.00% – 11.00% | High |
| Select-Service (national brand) | 7.50% – 8.75% | 9.50% – 11.50% | High |
| Boutique / Independent | 8.25% – 10.00% | 10.50% – 12.50% | Medium |
| Full-Service Urban | 8.00% – 9.50% | 10.00% – 12.00% | Medium–Low |
| Resort / Leisure Destination | 7.50% – 9.00% | 9.50% – 11.50% | Medium–High |
| Motel / Extended-Stay Budget | 8.50% – 11.00% | 10.50% – 13.50% | Low–Medium |
Bank vs. Private Lender Rate Comparison
| Factor | Bank (Hospitality Loan) | Private / Debt Fund |
|---|---|---|
| Rate (permanent/bridge) | 7.00% – 9.50% | 9.00% – 13.00% |
| Close speed | 45–90 days | 14–30 days |
| DSCR requirement | 1.40x – 1.50x | 1.25x – 1.40x |
| LTV / LTC | 55–65% | 60–70% |
| Documentation | Full (STR data, T-12, P&L) | Light–moderate |
| Experience required | Yes, strictly enforced | Yes, flexible for strong assets |
| Non-recourse available | Yes (CMBS, some banks) | Selective (large loans) |
Frequently Asked Questions
What are typical hotel loan rates in 2026?
Hotel loan rates in 2026 range from approximately 7.00%–8.75% for permanent bank financing on stabilized, nationally branded properties, to 9.00%–11.50% for bridge loans from debt funds, to 11.00%–14.00% for hard money or distressed-asset hotel loans. SBA 504 owner-occupied hotel loans offer the most favorable rates at 6.00%–7.50%. Rates are highly dependent on hotel type, market, LTV, and RevPAR performance.
Are hotel loans harder to get than other commercial real estate loans?
Yes. Hotel loans carry both real estate risk and operating business risk, making them more complex to underwrite and more selective among lenders. DSCR thresholds are higher (1.40x–1.50x vs. 1.20x–1.25x for multifamily), LTV caps are lower, experience requirements are stricter, and the documentation package includes hospitality-specific items like STR demand studies, RevPAR data, and franchise agreements.
What DSCR do hotel lenders require?
Most hotel lenders require a minimum DSCR of 1.35x–1.50x, which is notably higher than the 1.20x–1.25x standard for multifamily and most other commercial property types. The higher DSCR requirement reflects the volatility of hotel income, occupancy and ADR can move significantly with economic conditions, travel trends, and local market events. Private bridge lenders may underwrite to lower DSCR on a value-add basis.
Related Guides
- Commercial Real Estate Loan Programs
- SBA Loan for Hotel Purchase: SBA vs. Private Financing Guide
- Motel Refinancing with Private Lenders: Niche Options for Motel and Extended-Stay Refis
- Boutique Hotel Financing Options: Creative Structures for Independent Properties
- Hospitality Bridge Loan for Renovation: How Renovation Bridge Loans for Hotels Work
- Commercial Bridge Loans: Complete Guide
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