Financing hotel projects: the strategic rise of private credit

In a global economic climate marked by rising interest rates, market uncertainty, and a widespread tightening of banking conditions, financing hotel projects is becoming increasingly complex. Traditional financing solutions – conventional bank loans, institutional financing, or syndicated loans – are now more expensive, slower to release, and less accessible, particularly for projects deemed risky, atypical, or in transition.

Yet the needs are there: according to the latest global estimates, nearly USD 957 billion in commercial real estate debt matures in 2025, of which USD 48 billion directly concerns the hotel sector. In this tight landscape, an alternative solution is gaining ground: private credit.

Private credit, an agile response to new challenges

Private credit is now establishing itself as a strategic lever for ambitious hotel project developers. It offers tailor-made financing structures, often more flexible than those offered by banks. These non-traditional players – investment funds, management companies, or specialized platforms – can finance:

Conversions of existing buildings (offices, older buildings, etc.) into hotels, new hotel development projects in growth markets,

Acquisitions of distressed or repositioning assets, or strategic recapitalizations.

Unlike banks, these lenders can adjust their terms to the specifics of the project, factoring in the developer’s vision, business plan, and guarantees. This often translates into faster implementation, less administrative burden, and an approach centered on the asset’s potential.

When financial innovation accelerates development

Recent examples show how private credit has made it possible to bring innovative hotel projects to life, particularly in the United States. In New Orleans, for instance, a former office building was successfully transformed into a hotel thanks to structured private financing. It was precisely the availability of this form of capital that allowed the project to succeed, where conventional bank financing had proved hesitant.

High-growth regions – such as the U.S. Sunbelt (Texas, Florida, Arizona) – are also attracting hotel investors… and the private lenders seeking to capture this momentum. These areas, marked by growing tourism and residential demand, offer fertile ground for innovative financing structures, sometimes more complex but with strong profitability potential.

And in Madagascar?

At RADAMA SA, we closely follow these developments to structure financing arrangements suited to the realities of the Malagasy market. Our conviction is clear: sustainable, high-quality, guest-experience-focused hotel development cannot happen without a creative and robust approach to financing.

We are actively exploring international private credit, specialized investment funds, and hybrid financing options to support hotel project developers in Madagascar – whether they wish to build, renovate, or reposition an asset. This is part of our mission to build an ambitious local hotel industry, rooted in its territory but resolutely turned toward the future.

📣 Do you have a hotel project and want to structure its financing?
The RADAMA SA team is at your disposal to help you find the solution best suited to your needs – combining local expertise, international market intelligence, and a network of strategic financial partners.

👉 Contact us today to discuss it!