Alternatives to banks to finance fishing lodge

[bardfromedson]

I am looking at buying a fishing lodge in Central America. The books are good and lots of potential to take it to the next level. The owner mentioned the local bank was not interested in financing another potential buyer. My bank in Canada is not too excited about taking on the project. Anyone know of some alternatives for financing such a purchase. Should have about 30-40% down.

 

[CIVANO]

Are you going to be there on site to manage it? Crooked transactions are ripe with an absente owner. Just a thought

 

[Foxsea]

I am looking at buying a fishing lodge in Central America. The books are good and lots of potential to take it to the next level. The owner mentioned the local bank was not interested in financing another potential buyer. My bank in Canada is not too excited about taking on the project. Anyone know of some alternatives for financing such a purchase. Should have about 30-40% down.

High risk venture.
A recent survey for major airlines found over 40% of respondents intend to fly internationally less or much less in the future. Only 18% said they planned to fly as often or more often as before Covid restrictions. Many remain unsure.
My experience with private financing suggests that the collateral requirements and costs would be prohibitive.

 

[bardfromedson]

Are you going to be there on site to manage it? Crooked transactions are ripe with an absente owner.

It is going to be a family purchase and someone will be at the lodge full time.

 

[bardfromedson]

High risk venture.
A recent survey for major airlines found over 40% of respondents intend to fly internationally less or much less in the future. Only 18% said they planned to fly as often or more often as before Covid restrictions. Many remain unsure.
My experience with private financing suggests that the collateral requirements and costs would be prohibitive.

The place is fully booked to the end of 2022. 60% booked for 2023. Lots of repeat business. 85% of bookings are from outside North America. Still a risky business but solid foundation

 

[Gong Show]

I find it interesting that the local bank does not want to continue business with the lodge.
Should be an easy relationship with good lodge numbers.

 

[BCI]

I find it interesting that the local bank does not want to continue business with the lodge.
Should be an easy relationship with good lodge numbers.

Agreed. The bankers hate losing money, and the bankers love making money. If the local bank won't finance it for a new operator with 30-40% down then that should be a red flag.

Canadian bank won't have much appetite for something that isn't in their country - challenging for them to recover costs on an our of country asset.

 

[sir-vivor]

Agreed. The bankers hate losing money, and the bankers love making money. If the local bank won't finance it for a new operator with 30-40% down then that should be a red flag.

Canadian bank won't have much appetite for something that isn't in their country - challenging for them to recover costs on an our of country asset.

You might have to consider a irrevocable letter of credit from your or a canadian bank, and offer it to the SA banker at a pre negotiated amount that the SA banker would accept to fund your venture (he may want 30-80% of the total exposure ) but at least you'll start a relationship and build on that. International financing is a tough one for sure so you have to take a form of cash with you

 

[Rain City]

The Cartels would be happy to help you out, I'm sure.

 

[Confused]

A lot of these kind of deals are vendor financed.......no appetite there?

 

[17 ft sea ranger]

start selling shares to members on here to make up the 60-70%!!

 

[CBsqrd]

Seed / venture capital is usually raised from the three F’s - friends, family and fools.

The vendor financing option mentioned above is probably the best route forward if available. Very hard to get co-investors for something like this as there is no way to realistically get liquidity if needed.

 

[pescador]

Is it a country that you speak the language of? I see a lot of English speakers here is Spain sucked into business ventures who don't understand Spanish law and contracts who get hosed. Usually in real estate deals, but, I guess it could apply to other business acquisitions. If you can, get independent advice from someone trustworthy. Just one mans view.

 

[Capt_Ed]

Which country

 

[wildmanyeah]

Something that a lot of people do but pretty much every expert says not to do is to take line of credits out against your family’s homes.

 

[ziggy]

Maybe sell shares, form a CoOp. Kind of like a timeshare concept.

 

[ab1752]

Spac for the win! You might find some df PE guy but they will bleed you dry and you lose full control. You need to retain control and do this with no debt, on the lodge anyway, and leverage your canadian assets to the hilt, as long as the lodge dividends can support it.

 

[Old Blue]

I am looking at buying a fishing lodge in Central America. The books are good and lots of potential to take it to the next level. The owner mentioned the local bank was not interested in financing another potential buyer. My bank in Canada is not too excited about taking on the project. Anyone know of some alternatives for financing such a purchase. Should have about 30-40% down.

So the owner said the bank wasn't interested....have you actually contacted them? Maybe the bank has more insight about the business.

 

[Dogbreath]

So the owner said the bank wasn't interested....have you actually contacted them? Maybe the bank has more insight about the business.

In lots of Latin American countries foreigners aren't allowed to own property within however many clicks of the coast-not just Mexico where a lot of readers here will have heard of that restriction.

Of course having the property in someone else's name is how things are done but as mentioned a person needs excellent Spanish language skills and competent legal representation; asking your law firm about progress and being told 'No hay problema/There's no problem' means you're being told to get lost you have to be able to read/understand documents and ask cogent questions on your own.

 

[bardfromedson]

So the owner said the bank wasn't interested....have you actually contacted them? Maybe the bank has more insight about the business.

We are working on that as well. But I am trying to figure out alternatives if it falls through. Also trying through Canadian banks to see how much we can leverage our properties here