Anyone who has secured a commercial loan is familiar with the formal process referred to as Know Your Customer or “KYC.” Lenders request due diligence materials on a potential borrower to develop, among other things, a comprehensive understanding of their overall business focus, track record and operational expertise. This practice helps lenders assess whether a borrower can fulfill their debt obligations. I encourage hotel owners to engage in a similar, albeit informal, process of their own — reverse KYC — particularly in today’s lending environment.
The arrival of the generalist lenders
The number of groups extending credit to hotel owners has increased in recent months. While more capital is generally a positive signal for the industry, many of these new entrants are "generalist" lenders who move in and out of the lodging sector depending on the prevailing capital market conditions. For a sponsor, it is critical to understand why these groups have arrived, how they influence the current lending environment and how they have behaved in previous cycles when conditions turned murky.
Over the past few years, generalist real estate lenders have faced increased competition in their target markets, principally in multi-family and industrial sectors. As the supply of debt capital in those sectors increased, rates to borrowers compressed, along with lender returns. In search of higher yields, these lenders have looked toward other real estate asset classes and rediscovered the hotel industry.
This influx of liquidity puts downward pressure on rates. Not only is more capital available, but these newer entrants generally have lower yield expectations compared to the hotel industry’s incumbent lenders. The interest rates being offered to multi-family and industrial borrowers are significantly lower than those to hotel owners. As a result, generalist lenders can offer rates to hotel borrowers that are (i) higher than those in their target market, fulfilling their desire for higher returns, and (ii) lower than those being offered by incumbent hotel lenders. This dynamic has led to overall rate compression, which, on the surface, appears to be a tremendous surplus to hotel owners.
The appeal of lower borrowing rates is obvious. The only way a borrower truly benefits from tighter rates, however, is if the lender remains a steady, predictable partner from origination through maturity. Due to nightly leases and the heavy operational component, a hotel investment is inherently more intricate than investments in warehouses or apartment complexes. Additionally consider the variety of project types borrowers undertake, whether it’s new development, brand conversion or heavy property improvement plan (PIP), the "journey" to the end of a business plan often looks different than initially underwritten.
A borrower must assess whether their financial counterparty understands and has experience with the unique characteristics of hotel investing. The borrower’s assessment will help it determine whether its lender will act as a collaborative partner or a rigid adversary when challenges arise. Lenders observe how borrowers react to adverse environments. Savvy borrowers should learn how prospective lenders have reacted to the same.
Generalist investors have visited the hotel sector in prior cycles. However, when times got tough, many found that asset-managing a hotel loan was more involved than managing a "rent-roll" asset class. In the past, this lack of subject matter expertise has led to rather immediate "de-risking" by lenders looking to cut their losses. This behavior has manifested in several ways:
- Funding hurdles: Advancing committed funds to complete critical projects, such as construction or PIPs, may slow or stop entirely.
- Loan sales: Lenders may sell the loan, sometimes without the borrower’s knowledge.
- Aggressive restructuring: Lenders may opt for changes to key terms and conditions including securing additional collateral.
When a lender enters the hotel sector simply because the returns on their alternatives are temporarily unattractive, they may just as quickly abandon the sector when realizing returns takes more effort. At that point, the initial rate benefit the borrower received becomes irrelevant.
Your reverse KYC checklist
The benefits of partnering with a lender who understands the nuances of hotel investing may outweigh the basis point savings offered by a generalist. To ensure you are partnering with an experience hotel lender, consider asking potential lenders the following:
1. Portfolio consistency: What is the size of your hotel portfolio, and how has it expanded or contracted over the last decade?
2. Asset expertise: What is the specific hotel experience of the credit and asset management teams? Do they have seniority and tenure with the firm?
3. Historical behavior: Have you sold hotel loans in the past, and under what circumstances?
Conducting a reverse KYC process is about ensuring the lender and terms you sign up with will be with you throughout the life of your current project and those in the future. Conduct one to increase your confidence in your lender’s background, capabilities and approach to handling things when the winds shift. It will reveal the character of your financial counterparty.
Ankur Shah is the chief financial officer of Access Point Financial, a $3 billion hotel-focused real estate credit firm.
The opinions expressed in this column do not necessarily reflect the opinions of CoStar News or CoStar Group and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to contact an editor with any questions or concern.
9 Places Where Wild Horses Roam Free in the USA and Canada
Wirestock/iStock
https://www.fodors.com/news/photos/discover-north-americas-wild-horses-unique-habitats-and-conservation-stories
“You couldn’t drag me away from watching wild horses.”
I’m not a huge
Rolling Stones fan, but picking the band’s favorite song is a breeze. “Wild Horses” reminds me of the many times I’ve been lucky to see exquisite equine beauties run free. Like many children, I was smitten with
Misty of Chincoteague and the feral herd in the
Outer Banks, especially after family camping trips to Virginia and North Carolina. This aura surrounding wild horses has remained strong over time. Encountering a pregnant mare on
Sable Island, Nova Scotia, riding within eyesight of a wild herd under Ecuador’s Mt. Cotopaxi, or spying on a band of horses while paddling Arizona’s
Salt River, reminds me that, even in our hemmed-in world, there remains room to roam physically, emotionally, and spiritually.
1 OF 9
Chilcotin Plateau
WHERE: British Columbia, Canada
Over eight hundred horses roam the Chilcotin Plateau, B.C.’s remote ranch country. In 2002, the Xeni Gwet’in First Nation established the Elegesi Qayus Wild Horse Preserve Declaration to protect about half of the horses that have inhabited this region for centuries. Located in the Brittany Triangle between the Chilko and Taseko Rivers, the Preserve is also home to the Indigenous-owned
Nemiah Valley Lodge. The lodge opened in 2022 and offers guided outings in July and August to observe the horses and learn about their role in the Xeni Gwet’in culture.
2 OF 9
Chincoteague
WHERE: Assateague Island, USA
The harsh conditions of a Southeastern barrier island seem an inhospitable environment for a community of horses. Yet, the two
Assateague herds (one from the Virginia side, one from the Maryland side) have thrived for over a century. The Assateague herds are not wild; they’re feral animals that have escaped domestic confines to survive on their own. That these herds swam ashore after a shipwreck remains one of our great barrier island myths. The more sober tale that farmers first transported horses to the island to avoid taxation is considered more accurate. Misty of Chincoteague chronicles one mare’s experience in the “Pony Penning” festival, an annual July event when the Virginia herd is rounded up and swum from Assateague to Chincoteague to auction off many of the foals.
3 OF 9
Outer Banks
WHERE: North Carolina
At least five centuries ago, explorers brought mustangs to the shores of North Carolina. The
Corolla wild horses, aka Banker ponies, continue to inhabit the Corolla and Corova dunes of the Outer Banks. Arguably the harshest environment on the Southeastern seaboard, the Outer Banks are known for hurricanes, shifting sands, and sparse vegetation. The Banker bands roam among 7,000 protected acres, though potential habitat encroachment remains an ongoing threat. The Corolla Wild Horse Fund (CWHF) was founded in 1989 to monitor and safeguard the fragile population of about 100 individuals. The CWHF operates a rehabilitation farm in nearby Grandy, and several local companies run seasonal horse viewing and wild horse education tours.
PHOTO: Streecutter/Dreamstime
4 OF 9
Sundre
WHERE: Alberta, Canada
There are just under 1000 wild horses in Alberta, the largest population in Canada. Most free-roaming horses live in the Sundre region, about 90 minutes north of Calgary. Other bands inhabit Ya Ha Tinda near Banff National Park, a contained area lauded as the wintering ground for the Parks Canada ranger’s herd. The Wild Horses of Alberta Society (WHOAS) are equine advocates, mediating their impact on the private ranchland from which they most likely descended (and which technically makes them feral rather than wild). Drive west from Sundre on Coal Camp Road and Forestry Trunk Road for the best opportunity to see bands of these horses. You can also visit the WHOAS rescue facility near Sundre.
5 OF 9
Sable Island
WHERE: Nova Scotia, Canada
When you visit remote Sable Island off the coast of Nova Scotia, it’s easy to imagine the wild horse population here descended from shipwrecks. After all, an estimated 350 vessels have met their demise, having struck sandbars after failing to negotiate the infamous currents and thick fog. However, the horses’ origins are thought to be those seized by the British when they expelled the Acadians in the late 18th century. Once removed to near extinction in the 1950s, the shaggy-coated, long-maned, sloping-crouped bays, chestnuts, and blacks number around 500 draft horse-descended individuals today.
6 OF 9
Lower Salt River
WHERE: Arizona
What a delight to paddle through the Tonto National Forest and come upon a band of wild horses standing knee-high in the Lower Salt River. The Indigenous have raised horses in this area since the early 1600s. However, many of the Salt River mustengo (“ownerless beasts”) are descendants of Spanish Colonial or Iberian horses and have long been considered wild. The Salt River Wild Horse Management Group advocates for the 300 or so Salt River mustangs when their presence in the National Forest abuts U.S. regulations, as it has several times over the past century. If you don’t have a kayak or innertube handy, Coon Bluff is considered an excellent viewpoint for seeing the band.
7 OF 9
Steens Mountain Wilderness
WHERE: Oregon
Horses evolved in North America 3.5 million years ago, became extinct 11,000 years ago, and were reintroduced by the Spanish to the continent in the early 1600s. Northwest Indigenous nations were raising horses by 1700, repopulating the region within one century. Today, more than 4,500 wild horses live in Oregon’s Herd Management Areas, including the South Steens HMA. The Steens Mountain herds, often visible from the road, represent diverse breeds, including Kiger Mustangs, palominos, Appaloosas, and paints.
8 OF 9
Pryor Mountain
WHERE: Wyoming
Like many wild horse populations throughout North America, the
Pryor Mountain mustangs descended from Colonial Spanish livestock. The herd also shares a unique gene pool that, if lost, could not be replicated in the wild. Because habitat constraints restrict many wild horse populations, including the Pryor Mustangs, from interbreeding, biologists closely study their evolutionary traits. The Pryor Mountain Wild Mustang Center offers information and full-day tours into the Pryor Range to see and learn about the wild horses.
9 OF 9
Waipi’o Valley
WHERE: Hawaii
The Waipi’o Valley in Hawaii possesses many historical and biological characteristics. The “Valley of Kings,” the boyhood home of King Kamehameha I, was a thriving community numbering 10,000 inhabitants before European contact. Only 50 people call the lush valley home today, as do a wild band of horses that roam the rainforest. The horses are thought to have descended from the Mexican and Arabian stock once gifted to the King. When horsepower became obsolete due to the advent of motor vehicles, the horses were set free. The forest does well to hide the horses, which, with estimates of 50 to several hundred individuals, are obviously difficult to census. Current travel to Waipi’o Valley is restricted. New road construction is currently underway to provide safe access to the valley again soon.
From brand portfolios to brand platforms: An analysis of the Yotel x Hilton cobranding agreement
https://hotelsmag.com/news/from-brand-portfolios-to-brand-platforms-an-analysis-of-the-yotel-x-hilton-cobranding-agreement/
The recently announced affiliation between Yotel and Hilton may look like just another partnership at first blush—it is not. Properly understood, this is a distribution and loyalty alliance—not an acquisition—and, more importantly, a signal of a deeper structural shift in the hospitality industry.
This is not about brand portfolio integration, it is about brand platform power. Yotel’s integration into Hilton’s ecosystem closely mirrors Hilton’s earlier
partnership with Small Luxury Hotels of the World (SLH), where independent properties plugged into
Hilton Honors without losing their identity. At the same time, Yotel is pursuing aggressive growth, targeting roughly 100 hotels globally by 2031. The timing is not coincidental. Translation: this is not a traditional brand portfolio expansion strategy but a
brand platform ecosystem play. And it has implications far beyond the two companies involved—particularly for Online Travel Agencies (OTAs), which have long dominated the industry’s distribution landscape.
Strategic Logic: Scale Meets Demand
For Yotel, the core issue has never been concept; it has been scale. With roughly two dozen properties, a strong design ethos and a differentiated “cabin-style” product, Yotel has built a compelling brand. But like many challenger brands, it has struggled with expanding its global footprint.
Its tie-up with Hilton solves that instantly. Through Hilton Honors—now exceeding 240 million members—Yotel gains access to a massive, loyalty-driven demand engine, along with corporate accounts, a global sales force and reduced reliance on high-cost OTA channels. In one move, Yotel addresses its biggest constraint: visibility and distribution.
As important, the affiliation enhances Yotel’s institutional credibility. The brand shifts from a “cool disruptor” to a trusted, globally scalable platform-compatible concept—a crucial transition for attracting investors, franchisees and mixed-use developers.
The economics follow: Increased occupancy, particularly midweek corporate demand, combined with improved channel mix, should lift RevPAR and improve unit-level profitability.
Hilton’s Play: Platform Expansion Without Capital Investment
For Hilton, the logic is equally compelling, but strategically more ambitious. Hilton has long been a brand portfolio company. Increasingly, it is becoming something else: a brand platform ecosystem. Yotel fills a gap in Hilton’s portfolio—a tech-forward, compact, urban product that resonates with younger, digitally native travelers. But more importantly, it expands Hilton’s network without requiring Hilton to build or buy a new brand. This is the key shift.
Instead of owning every brand, Hilton is assembling a portfolio of affiliated brands that plug into its ecosystem—an ecosystem that includes development, sales, pricing, promotion, distribution, loyalty, purchasing and talent.
The result is a powerful flywheel: more properties → more redemption options → more member engagement → more direct bookings. In other words, classic network effects.
The Trade-Offs: Scale vs. Control
Despite the upside, the partnership is not without risk. For Yotel, the primary concern is dependency. Plugging into Hilton’s distribution engine and loyalty program inevitably reduces independence. Over time, there is a real risk that Yotel becomes less of a distinct brand and more of a “category” within Hilton’s ecosystem.
For Hilton, the challenge is increased complexity. As the portfolio expands to include more soft brands, collections and affiliated partners, the risks of brand overlap and consumer confusion increases. At some point, the architecture may become harder to manage—and harder for guests to understand.
There are also economic trade-offs. Loyalty participation comes with costs, and channel conflicts may emerge between Yotel’s direct booking efforts and Hilton’s centralized systems.
Competitive Implications: The Brand Platform Ecosystem Arms Race
Competitors will not stand still. Marriott International is already strong in soft brands and will likely expand partnerships or pursue targeted acquisitions. Hyatt Hotels Corp., having lost SLH to Hilton, may double down on boutique affiliations. IHG Hotels & Resorts will continue to scale its Vignette Collection and pursue alliances. Meanwhile, Accor is arguably furthest along this path, with its Ennismore platform and growing ecosystem of independent brands. What emerges is not just competition between portfolios, but competition between platforms.
A Shift in Power—Including Against OTAs
Perhaps the most important implication lies in the shifting balance of power with OTAs, such as Booking Holdings and Expedia Group. By expanding loyalty-driven direct channels, Hilton strengthens its ability to bypass intermediaries. Each additional affiliated property increases the value of its ecosystem and reduces reliance on external platforms. In effect, hotel companies are building closed-loop demand systems to compete directly with OTAs to lower their distribution costs.
The Bigger Picture: From Brand Portfolios to Brand Platforms
The Yotel–Hilton affiliation signals three structural shifts in hospitality:The rise of platform hospitality, where control of demand matters more than ownership of brands.
The blurring of brand boundaries, as independent concepts plug into global systems.
The acceleration of asset-light growth, enabled by partnerships rather than construction.
Bottom Line
For Yotel, the deal solves its distribution dilemma, but introduces identity risk. For Hilton, it strengthens its platform, but adds brand architecture complexity. For the hotel industry, the message is clear: We are moving from brand portfolio wars to brand platform wars. And in that world, the winners will not be those with the best brands. It will be those who own the customer.
Chekitan S. Dev is a professor at
Cornell University’s Nolan School of Hotel Administration in the SC Johnson College of Business and a 47-year veteran of the global hotel industry.
Popular Destinations Will Be Even Busier This Summer Because of the Iran War
Photobank-2/Shutterstock
https://www.fodors.com/news/news/popular-destinations-will-be-even-busier-this-summer-because-of-the-iran-war
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