The Hidden Cost of Waiting to Refinance

By Katie Vivian – Hotel Loan Originator

Many hotel owners are waiting for rates to come down further before refinancing.

But one thing I’m discussing more frequently with borrowers right now is the hidden cost of waiting.

Even if rates improve modestly, other factors may move against owners over the next 12–24 months:

• Insurance costs continue to rise

• Property taxes are resetting higher in many markets

• Labor costs remain elevated

• Upcoming PIPs can materially impact proceeds and lender appetite

• A wave of 2026-2027 maturities is creating increased competition for capital

At the same time, we are still seeing strong lender appetite today for well-positioned select-service hotels, particularly Hilton, Marriott, and IHG assets with stable cash flow and no near-term brand issues.

The owners achieving the best executions right now are typically the ones starting the conversation early, before a maturity, PIP deadline, or operational issue creates pressure.

A refinance does not always need to be about maximizing proceeds or simply chasing the lowest rate. Sometimes the biggest value is securing the right structure, flexibility, and long-term stability.