Can you finance a hotel refurbishment, fit‑out or FF&E upgrade?
Short disclaimer: UK Business Loans does not lend or provide regulated financial advice. We introduce you to lenders and brokers who can provide quotes. Completing our enquiry form is free and does not commit you to a loan; lenders or brokers may contact you to discuss options.
Quick answer
Yes — in most cases a hotel refurbishment, fit‑out or FF&E upgrade can be financed. There are specialist finance products that suit different scopes: asset finance for furniture and equipment, unsecured or secured refurbishment loans for non‑structural works, development or mortgage refinance for large structural projects, and bridging or staged funding where speed is critical. Which route is best depends on project size (typical deals from about £10,000 upwards), timing, and what security you can offer.
Get a free eligibility check — quick, no obligation, and lenders or brokers will respond to discuss options.
Why hotels need refurbishment finance
Hotel owners refurbish for many reasons: rebranding, improving room yield, meeting new safety or accessibility rules, adding sustainable upgrades, seasonal updates or to maintain competitiveness. Upgrades often deliver higher average daily rate (ADR) and occupancy, but the upfront cash can be significant.
Typical project ranges (illustrative only): minor FF&E replacements £10k–£100k; partial room or lobby refits £50k–£300k; full refurbishments for small to medium hotels £200k+. Because hospitality is seasonal, many operators prefer structured finance that spreads cost while preserving working capital.
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Step 1
Complete Your Details
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Step 2
We Match Your Business
With the best business finance broker or lender most suitable for your needs.
Step 3
You Get Free Quote + Advice
You receive a free quote along with complimentary expert financial advice.
It’s fast and free to get a quote from one of the UK’s leading finance brokers / lenders who will contact you directly with your quote/s.
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Case teaser: a 20‑room boutique converted old bedrooms and replaced FF&E using asset finance — ADR rose 12% within three months.
Finance options explained
Asset & Equipment Finance (FF&E)
What it covers: furniture, fixtures, fittings, kitchen and bar equipment, POS systems, mattresses, linen — items with measurable asset value.
Our Business Finance Matching Process
Step 1
Complete Your Details
It takes just 1 minute on average to complete your business and contact details.
Step 2
We Match Your Business
With the best business finance broker or lender most suitable for your needs.
Step 3
You Get Free Quote + Advice
You receive a free quote along with complimentary expert financial advice.
It’s fast and free to get a quote from one of the UK’s leading finance brokers / lenders who will contact you directly with your quote/s.
Products: hire purchase, operating leases, finance leases and dedicated equipment loans. These let you spread cost over the asset life, often with lower upfront deposits.
Typical terms: 2–7 years depending on the asset type and useful life. Monthly payments are predictable and can be structured to match seasonal revenue.
Best for: funding FF&E without using property as security, keeping cashflow intact while modernising rooms.
Fit‑Out / Refurbishment Loans
What it covers: contractor costs for internal fit‑outs, finishes, lighting, bathrooms (non‑structural), design and project management fees.
Products: unsecured business loans (if smaller), secured term loans where business assets or a charge over property are offered, and peer‑to‑peer lenders who may take different risk views on hospitality. Rates, loan sizes and LTV vary widely by lender and credit profile.
Complete Our 1-Minute Enquiry Form Now – Get a No-Obligation Quote
Typical terms: 1–5 years for medium projects; larger loans may be longer. Lenders will want detailed quotes and may ask for director guarantees for SMEs.
Best for: medium‑sized refurbishments where using the property as security is limited or not desired.
Commercial Mortgages & Refinance (for larger works)
When appropriate: major structural works, extensions or conversions that materially change property value. Commercial mortgages or refinance can release equity to fund capex.
Options: refinance an existing mortgage to raise funds, take a second charge, or use specialist hotel finance lenders. Development finance may be needed for conversions into hotel use or significant rebuilds, but this requires strong development plans and pro forma valuations.
Considerations: lenders focus on valuation, location, proven trading or pipeline, and the strength of the business plan showing improved ADR/occupancy post works.
Bridging & Development Finance
Bridging loans provide short‑term capital to keep projects moving while securing long‑term funding or waiting for sale/refinance. Development finance funds staged construction/major conversions; drawdowns are typically tied to construction milestones.
These are higher cost but can be essential when speed or staged funding is needed.
Green / Energy Efficiency Loans & Grants
Many lenders now offer lower‑priced finance for sustainability works (solar PV, heat pumps, LED lighting, insulation, EV chargers). There are also grants and incentive schemes for hotels that meet eligibility. Combining grant funding with a green loan can significantly reduce net capex.
Alternative options: invoice finance, merchant / revenue advances, equity
Invoice finance or a merchant cash advance can boost working capital during refurbishments, but costs are generally higher. Equity or partner investment is another route for owners willing to dilute ownership. Vendor finance or supplier deferred payment terms may also help stage costs.
What lenders look for (eligibility checklist)
Prepare to show the following — lenders vary, but this checklist covers common requirements:
Our Business Finance Matching Process
Step 1
Complete Your Details
It takes just 1 minute on average to complete your business and contact details.
Step 2
We Match Your Business
With the best business finance broker or lender most suitable for your needs.
Step 3
You Get Free Quote + Advice
You receive a free quote along with complimentary expert financial advice.
It’s fast and free to get a quote from one of the UK’s leading finance brokers / lenders who will contact you directly with your quote/s.
- Business trading history and legal structure (limited companies and PLCs typically preferred).
- Annual turnover and management accounts (last 12–24 months).
- Profitability or clear cashflow forecasts/EBITDA; seasonal adjustments explained.
- Project cost breakdown and three contractor quotes or fixed‑price contracts.
- Evidence of positive demand or room yield forecasts after works.
- Property ownership details (owned, leasehold, headlease terms) and any existing charges.
- Director guarantees and credit history of owners where applicable.
- Planning permission or building regulation approvals for structural works.
- Photographs, design briefs and contractor CVs or references.
Tip: package the application with a concise project summary showing cost, timeline, expected uplift in ADR/occupancy and contingency budget (typically 10–15%).
Typical costs, timing and repayment expectations
Illustrative examples (subject to lender assessment):
- Small FF&E replacement: £10k–£75k via asset finance; approval in days; drawdown on invoice submission; 2–5 year term.
- Medium refit (rooms, lobby): £75k–£400k via refurbishment loan; decision in days to weeks; staged payments; 3–7 year term.
- Full refurbishment or structural works: £200k+ using refinance/development finance; underwriting and valuation may take weeks; development finance drawn by stages; exit refinance usually into a mortgage.
Repayment: monthly or quarterly repayments are common. Lenders can sometimes offer seasonally‑adjusted payments to match hospitality cashflow. Expect bridging and development finance to carry higher rates versus asset finance.
Risks and how to reduce them
- Cost overruns — mitigate with contingency, fixed‑price contracts and a professional quantity surveyor (QS).
- Reduced occupancy during works — phase works in low season and consider temporary room closures only when necessary.
- Higher interest costs if rates rise — choose fixed‑rate options where appropriate or cap arrangements.
- Cashflow squeeze — keep an emergency working capital line or invoice finance in reserve.
Preparing your application — step by step
- Clarify project scope and budget; obtain at least two contractor quotes and a contingency plan.
- Decide preferred finance type (asset, loan, refinance, development) based on cost and security.
- Gather accounts, management accounts, VAT returns and director details.
- Produce a short business case: how the works will improve room yield and timing for ROI.
- Submit a quick enquiry so we can match you to the right lenders/brokers: include project cost, desired term and whether you own the property.
- Compare offers and confirm drawdown schedule before instructing contractors.
Checklist to upload with your enquiry: turnover, years trading, project cost, property ownership status, desired repayment term, contractor quotes.
Real‑world examples (short)
Example A — 20‑room boutique: Replaced FF&E and modernised public areas with asset finance (£65k). Monthly payments matched seasonality; ADR increased 12% within 3 months and payback was forecast within 2 years.
Example B — 50‑room town hotel: Used a refurbishment loan plus refinancing of existing mortgage to fund a phased refit (£450k). The combination allowed staged drawdowns and preserved cashflow while improving STR ratings and corporate bookings.
FAQs
Can I finance just furniture (FF&E) rather than the full refit?
Yes. Asset finance or leasing commonly covers FF&E only, letting you upgrade rooms without borrowing against the property.
Will a lender fund a full structural renovation?
Major structural works usually require larger facilities such as development finance or mortgage refinance and need a strong valuation and business plan.
What if my credit score is poor?
Not all lenders assess risk the same. Some specialist hospitality lenders or brokers will consider trading performance, security and experience rather than relying solely on personal credit — you may still get options.
How long until I get a quote?
After you submit an enquiry, matched lenders or brokers often respond within hours to a few business days depending on complexity.
Do I need to own the property?
Not always. Asset finance for FF&E can be secured against the equipment; larger refinance or development funding usually requires ownership or landlord consent.
Are there special options for sustainability works?
Yes — green loans and certain grants exist for energy efficiency and renewable installations. Combining grant funding with a green loan often reduces net cost.
Get a Free Eligibility Check to receive tailored lender matches and quotes — free and no obligation.
Next steps — get a free eligibility check
Ready to explore options? Submit a short enquiry and we’ll match your project with lenders and brokers experienced in hospitality finance. Typical match process: fast review, lender calls or emails, then you compare quotes and choose the best fit.
Why use us? We save time, increase your chances of a suitable offer and keep the process simple. We commonly arrange facilities from around £10,000 upwards.
Get Quote Now — free, quick and no obligation. By submitting your enquiry you consent to us passing your details to selected lenders or brokers who may contact you to discuss your requirements.
Related resources
1. Can I get hotel refurbishment finance for a fit‑out, FF&E upgrade or structural works?
Yes — you can fund FF&E and non‑structural fit‑outs with asset finance or refurbishment loans, while major structural works typically need development finance or commercial mortgage refinance.
2. Can I finance just furniture and equipment (FF&E) rather than the full refit?
Yes — asset and equipment finance (leasing, hire purchase or equipment loans) commonly covers FF&E independently of property‑backed borrowing.
3. What types of finance are available for hotel refurbishments?
Common options include asset finance for FF&E, unsecured or secured refurbishment loans, commercial mortgage refinance, bridging and development finance, green loans for sustainability works, and alternative routes like invoice finance or equity.
4. How much can I typically borrow for a hotel refurbishment?
Deals commonly start around £10,000 for FF&E and can range to £75k for small refits, £75k–£400k for medium projects and £200k+ for full refurbishments or structural works depending on lender and security.
5. What do lenders look for when assessing a refurbishment or fit‑out loan?
Lenders usually want trading history and accounts, turnover and cashflow/EBITDA, detailed project costs and contractor quotes, property ownership/charges, planning approvals for structural work, and director guarantees where applicable.
6. Do I need to own the property to secure hotel refurbishment funding?
Not always — asset finance can be arranged without property ownership, but refinance, development finance or larger secured facilities typically require ownership or landlord consent.
7. Can I get hotel refurbishment finance with bad or limited credit history?
Possibly — some specialist lenders and brokers focus on trading performance, security and experience rather than just credit scores, though terms may be less favourable or require additional security.
8. How long will it take to get a quote or funding for a refurbishment?
Matched lenders or brokers often respond within hours to a few business days, with asset finance approvals possible in days while development or mortgage finance can take several weeks.
9. Will submitting an enquiry via UK Business Loans affect my credit score and is it an application?
No — completing our free enquiry form is not a loan application, won’t affect your credit score, and simply allows us to match you with suitable lenders or brokers who may contact you.
10. Is using UK Business Loans free and are the lenders and brokers regulated?
Yes — our service is free and no‑obligation, and we introduce you to trusted, FCA‑regulated lenders and brokers who handle underwriting and formal checks.