March 10, 2015
By Bob Coleman
Editor, Coleman Report
Says John Hamburger at the National Alliance of Commercial Loan Brokers conference yesterday in Las Vegas.
John is the publisher of Restaurant Finance Monitor and the sponsor of the largest restaurant financing conference in the country.
When asked about what is happening with restaurant financing he says:
“It’s a free-for-all. We are at the lowest interest rate spreads I have ever seen.
“Peak advance rates. They haven’t set the record but they have at least reached the high.
“Amortizations are stretched.
“I can always tell when a market is hot when restaurants start sending out requests for proposals. I have seen that a couple of times in my career, and that is going on right now.
“You are seeing banks on the senior debt side, where they used to participate, where they were taking the entire credit for themselves.
“The good thing is, people always say ‘Well we are in a bubble right?’ and I have to say not necessarily.
“I think because the industry is performing better and restaurants are reporting higher cash flows than they did a couple of years ago and they were not able to service debt.
“So I would say we are moving towards the tail end of this cycle that I have seen but we have a few more years to go.”