Getting the necessary funding for your vacation resort construction project may not be as easy as it sounds. There are lots of different ways to obtain funding, and also a lots of hoops you have to jump through. I’m going to discuss some of the basic methods, along with some more modern techniques. First there is the traditional bank loan. You marching to the bank with your project proposal and presented to a panel of investment bankers who go over your case with a fine-tooth comb. Most times there is a large down payment required and or collateral that has to be put forward. If your company has a good relationship with your bank, this is the easy way to go.
Another technique is through insurance companies. Insurance companies are always looking for new investments and they really rally around construction projects for vacation spots. For the most part they are very profitable and are safe investments for insurance conglomerates. They will also require that your proposal be reviewed by a panel of loan officers. Maybe the angel investor is the way to go. This is someone who invests his own money into lucrative projects and is always on the hunt for something as tasty as resort real estate. Their formalities or not quite as formal. You may end up just meeting with the investor and his lawyer. These are men and women who are very keen investors and understand most markets through and through. Their interest rates are usually a little higher, but the loans are easier to get.
The next is a similar technique to the angel investor. This is the Shark Tank phenomena based on the popular TV show. There are smaller shark tanks in every state which comprised of multi-millionaires on the hunt for new investments. They are not televised but their money is just as good. In fact it may be a lot easier to concentrate on the task at hand without the cameras rolling. One thing that helps in any investment project is vacation reservations lined up before you even look for funding. For example, if you are building a hotel and up 50% of your rooms are reserved ahead of time, this will make the investment even more inviting. The investor will know right from the door that there will be in steady stream of income right off the bat. Or better yet if you can find a buyer for the entire building before construction even takes off that generally guarantees a loan from any entity. Whichever way you decide to go, weigh all your options carefully and don’t always take the first offer.