CHICAGO —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
To best navigate through these tough times, restaurateurs looking for financing should find the best way to position their companies, keep business plans simple and conservative, expect limited capital, and focus on banking or lender relationships, they said. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
Operators also were told to look into less traditional forms of lending while national players and other larger banks sit on the sidelines. Those financing tactics could include private placements, landlord financing, the purchase of used equipment, or borrowing through smaller, community banks. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
“I’m old enough to know we will get through this,” said Bernie Siegel, founder and chairman of Siegel Financial Group, a Philadelphia-based company that helps secure financing for small businesses. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
Today’s lending environment remains stalled, panelists said. Small Business Administration lending has slowed to a crawl; banks are less inclined to finance new loans; and others, such as equity sponsors, are mostly watching from the bench, waiting for the economy and the restaurant industry to recover. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
However, there are signs of life starting to appear in the credit markets, according to industry insiders. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
“There are clear signs of improvement,” said Kevin Cronin, senior executive in the global corporate banking group at Bank of America. “The credit markets are recovering…but this will not be a V-shaped recovery.” —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
Federal programs designed to help turn the lending spigot back on could give banks and investors more confidence to return to lending, Cronin said, but those initiatives will take time. Until then, operators will have to use a patchwork of financial sources and strategies to hit expansion targets and continue growth. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
Dan Stone, director of franchise sales at The Melting Pot Restaurants Inc., said the restaurant company’s four preferred lenders have stopped lending to the restaurant industry. To help potential lenders feel more comfortable with the industry, and the 140-unit-plus casual-dining chain in particular, The Melting Pot has agreed to guarantee loan payments for up to 12 months for franchisees that find themselves in default, Stone said. The company also will operate the unit for up to 12 months and commit to re-marketing the restaurant, he added. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
“We found a way to work around the hurdles,” Stone said. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
He also noted that The Melting Pot wrote a letter to CIT Small Business Lending, one of the largest SBA lenders, which halted new lending last year when the secondary market froze. In the letter, The Melting Pot explained in detail any sales slips or development bumps. The communication led to a soon-to-be-finalized agreement between CIT and The Melting Pot that would resume lending, Stone said. —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
“There is capital available,” said Alexandra Burke, a managing director at the Wells Fargo Restaurant Group. “Relationships are more critical today.” —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
Wells Fargo said it has $3.5 billion committed to the restaurant industry.— [email protected] —Access to capital, the lifeblood of the restaurant industry, still is tight even as signs of improvements in the credit markets begin to appear, said bankers, financiers and restaurant operators during panel discussions at last month’s National Restaurant Association Restaurant, Hotel-Motel Show.
