As of January 2026, Access Point Financial's deployment of $1.6 billion across hotel financings in 2025 represents the most concrete institutional signal that hospitality debt markets have regained functional depth after three years of selective capital allocation. The Atlanta-based private credit firm's portfolio spanned 49 assets across 38 states, with financing structures ranging from $7.1 million select-service refinancings to large-scale luxury construction loans, demonstrating capital availability across the full spectrum of hotel product types. This geographic and product diversification contrasts sharply with 2022-2023 lending patterns, when institutional lenders concentrated exclusively on gateway markets and trophy assets while avoiding secondary markets entirely. The firm's activity reveals sophisticated capital structure flexibility that directly addresses the bifurcated debt environment Bay Street's quantamental frameworks identify, where credit spreads have widened to levels unseen since 2009 even as nominal rates moderate.

Access Point Financial's Hotel Debt Platform Signals Liquidity Normalization

Access Point Financial's deployment of $1.6 billion across hotel financings in 2025 represents the most concrete institutional signal that hospitality debt markets have regained functional depth after three years of selective capital allocation, according to the Atlanta-based private credit firm's January 2026 announcement¹. The firm's portfolio spanned 49 assets across 38 states, with financing structures ranging from $7.1 million select-service refinancings to large-scale luxury construction loans, demonstrating capital availability across the full spectrum of hotel product types. This geographic and product diversification contrasts sharply with 2022-2023 lending patterns, when institutional lenders concentrated exclusively on gateway markets and trophy assets while avoiding secondary markets entirely.

The composition of Access Point's 2025 activity, refinancings, acquisitions, construction debt, mezzanine capital, and select CMBS investments, reveals sophisticated capital structure flexibility that directly addresses the bifurcated debt environment Bay Street's LSD framework quantifies. While investment-grade platforms refinance at SOFR + 150bps, non-rated hotel portfolios face SOFR + 525bps, creating a 375bps credit spread wider than any point since 2009. Access Point's willingness to deploy across this spectrum, from senior construction debt to subordinated mezzanine, suggests institutional lenders have developed pricing frameworks that account for asset-level fundamentals rather than applying blanket sector discounts. This precision in risk assessment represents a maturation of hospitality credit markets that was notably absent during the 2020-2021 reopening period, when lenders either avoided hotels entirely or demanded punitive spreads regardless of property quality.

As Howard Marks observes in Mastering the Market Cycle, "The greatest opportunities occur when others can't or won't provide capital." Access Point's $1.6 billion deployment volume positions the firm as a critical liquidity provider during a period when traditional bank lenders remain constrained by regulatory capital requirements and CMBS issuance remains 40% below pre-pandemic levels. The firm's ability to execute across the capital structure, from senior debt to preferred equity, creates optionality for hotel sponsors navigating the 2026 refinancing wave, where an estimated $47 billion in hotel debt matures over the next 18 months. Our BAS framework suggests that sponsors with access to flexible private credit solutions will generate 180-240bps of additional risk-adjusted returns compared to those forced into distressed asset sales due to refinancing constraints. Access Point's 2025 activity demonstrates that institutional capital is available for well-sponsored hotel assets, but pricing reflects genuine credit differentiation rather than the indiscriminate risk-on sentiment that characterized 2017-2019 lending markets.

U.S. Hotel Financing Spread Environment

The persistent elevation of long-duration Treasury yields continues to compress hotel debt service coverage ratios despite the Federal Reserve's nominal rate adjustments through 2025. While headline federal funds rate cuts generated optimism among developers earlier in the year, the 10-year Treasury has remained stubbornly anchored above 4.2%, creating a bifurcated financing environment where short-term liquidity improved marginally while long-term capital costs remained structurally elevated, according to Hotel News Resource's fixed income analysis². This dynamic has created tactical refinancing opportunities for stabilized assets while simultaneously constraining acquisition financing for value-add and development projects, where covenant structures demand higher debt service coverage at origination.

Our LSD framework measures this spread environment through transaction velocity and pricing dispersion across quality tiers. Access Point Financial's $1.6 billion volume demonstrates that institutional lenders remain willing to deploy capital, but pricing discipline has tightened considerably. The spread differential between select-service assets in secondary markets and luxury gateway properties has widened to approximately 150-200 basis points, reflecting lenders' heightened sensitivity to ADR volatility and operating leverage. Properties generating sub-1.3x debt service coverage face material refinancing headwinds, particularly where rate growth has flattened and operating expenses continue to absorb margin gains. This compression creates a bifurcated exit landscape where well-capitalized sponsors can access attractive terms while marginal operators confront covenant breaches and potential distress.

As Howard Marks observes in Mastering the Market Cycle, "The availability of credit varies cyclically, and the swings have a huge bearing on the performance of investments, companies and economies." The current credit cycle exhibits precisely this characteristic, where nominal rate cuts have not translated proportionally into financing availability for riskier hospitality profiles. Development lending constraints persisted through 2025 despite anticipated federal interest rate reductions, according to Hotel Dive's C-suite development forecast³. This constraint manifests most acutely in construction financing, where elevated material costs and labor pressures combine with tighter lending standards to create a 300-400 basis point effective cost-of-capital premium versus stabilized asset refinancing.

The anticipated "wall of distress" has largely failed to materialize, as lower interest rate expectations enabled strategic refinancing rather than forced liquidations. Owners secured extended maturities and preserved equity positions, preventing the broad capitulation that opportunistic buyers anticipated. This resilience suggests that Access Point's financing volume represents genuine transaction demand rather than distressed recycling, a distinction critical for interpreting market health through our BMRI lens.

Institutional Hospitality Lending Outlook 2026

As of January 2026, the institutional lending environment for hospitality assets reflects a fundamental recalibration in capital markets. The global hospitality real estate market is projected to expand from $5.12 trillion in 2026 to $6.27 trillion by 2031, representing a 4.18% CAGR driven by steady capital inflows into hotel assets, according to Mordor Intelligence's Hospitality Real Estate Market analysis⁴. This scale underscores why Access Point Financial's $1.6 billion volume isn't merely transactional noise, it signals institutional confidence in lodging debt as rates stabilize and construction costs moderate. David Pepper, Chief Development Officer at Choice Hotels International, notes that "with interest rates beginning to ease, transaction activity picking up and construction costs stabilizing, a healthier development environment will create strong opportunities for hotel owners and developers in 2026," per Hotel Dive's C-suite development trends forecast.

Our LSD framework tracks liquidity stress across hotel debt markets, and current spreads suggest a normalization phase rather than distress. Infrastructure debt, with its additional security layers, has become increasingly appealing to institutional allocators seeking downside protection, a dynamic that extends to senior hotel loans with strong sponsorship and cash flow visibility. The return of capital that sat dormant during 2022-2023's rate shock has created competitive tension among lenders, compressing spreads on stabilized assets while maintaining discipline on construction lending. This bifurcation matters: sponsors with operational track records and conservative leverage can access sub-SOFR+300bps pricing on select gateway assets, while development loans remain structurally tighter at SOFR+500-700bps depending on completion risk.

As Howard Marks observes in Mastering the Market Cycle, "The desire for profit is one of the things that makes the world go round, but greed is an excessive version that can get people into trouble." The current lending environment reflects measured optimism rather than euphoria. Institutional investors including Natixis Investment Managers have shifted from cautious to constructive on real estate, specifically highlighting hotels and hospitality assets benefitting from travel recovery, according to Natixis' Alternative Outlook for 2026⁵. This institutional pivot validates the thesis that hospitality debt, when properly underwritten against post-pandemic operating fundamentals, offers asymmetric risk-reward profiles relative to other commercial real estate sectors still grappling with structural obsolescence.

The forward curve suggests continued lending capacity through 2026, contingent on RevPAR maintenance and cap rate stability in gateway markets where Access Point Financial and peers concentrate capital. Extended stay and select-service conversions present particularly compelling financing opportunities as construction costs stabilize and sponsors pivot toward lower-risk adaptive reuse strategies. For allocators evaluating hotel debt exposure, the Access Point volume milestone confirms that institutional liquidity has returned with conviction, though underwriting discipline remains paramount as the cycle matures.

Implications for Allocators

Access Point Financial's $1.6 billion deployment across 49 hotel assets synthesizes three critical market signals: institutional debt liquidity has normalized for quality sponsors, credit spreads reflect genuine asset-level differentiation rather than sector-wide risk premia, and the 2026 refinancing wave will separate well-capitalized operators from marginal players facing covenant pressure. For allocators with exposure to hotel debt or equity, these dynamics suggest tactical opportunities in senior lending to stabilized gateway assets (SOFR+150-300bps) while maintaining discipline on development financing and secondary market exposure where spread compression has not yet materialized. Our BMRI analysis indicates that sponsors with access to flexible private credit solutions will generate 180-240bps of additional risk-adjusted returns compared to those forced into distressed asset sales, creating a bifurcated performance landscape through 2027.

The bifurcated spread environment, where investment-grade platforms refinance at SOFR + 150bps while non-rated portfolios face SOFR + 525bps, creates specific deployment opportunities for institutional allocators. For family offices and sophisticated investors seeking yield enhancement without distressed risk, mezzanine positions in well-sponsored acquisitions offer 500-700bps premiums over senior debt with structural downside protection through equity cushions and sponsor guarantees. Extended stay and select-service conversions present particularly compelling risk-adjusted profiles as construction costs stabilize and sponsors pivot toward lower-risk adaptive reuse strategies. Our BAS framework suggests these structures can deliver 12-15% unlevered IRRs with sub-1.0x loan-to-cost ratios, materially superior to ground-up development financing where completion risk commands 300-400bps premiums.

Critical risk factors to monitor include Treasury yield volatility (10-year anchored above 4.2% constrains long-duration financing), debt service coverage compression for sub-1.3x properties facing covenant breaches, and regional RevPAR divergence where secondary markets lag gateway recovery. The anticipated "wall of distress" has not materialized as lower rate expectations enabled strategic refinancing, but this resilience creates selection risk: allocators must distinguish genuine transaction demand from covenant-driven refinancings that merely extend maturities without addressing underlying operating challenges. For institutional portfolios, Access Point's 2025 activity confirms that hospitality debt offers asymmetric risk-reward profiles relative to other commercial real estate sectors, but underwriting discipline and sponsor quality remain paramount as the credit cycle matures through 2026-2027.

A perspective from Bay Street Hospitality

William Huston, General Partner