Guidance to the Borrower

“Intellectuals solve problems, geniuses prevent them.”
Albert Einstein

TIA adopts a broad view of a turnaround situation, starting before hotels display symptoms of operational underperformance. Thanks to our Advanced Debt Monitoring© (ADM) software, we are able to forecast cash flows up to 36 months and anticipate a potential event of default before it occurs.

Our objective for identified sub-performing loans, is to build a mutual trust relationship between borrowers and lenders to proactively decrease the probability of default.

Thanks to our experience and specific knowledge of both lenders’ and hotel managers’ issues, we are the ideal third party to reinforce the existing alignment of interest between creditors and debtors.

To the borrower:

Because timing is the key factor of success in handling a perfect turnaround, the first response to these early warning signals of underperformance is crucial.
That’s why we will effectively draw up a pre-emptive business transformation proposal and provide general guidance to the borrower at an early stage in order to ensure performance in case of a decline in revenue.

This proposal includes the following:

  • Securing the cash flow by introducing a measured and goal-oriented cost reduction plan
  • Setting up a Defensive Capex plan, focused on what is directly noticeable by hotel clients (“look-and-feel”-factor)
  • Discussing a potential partial asset sale

 

To the lender:

We provide you with a forecasted operational cash flow cycle and help you analyze and optimize the current debt cost structure.

These approaches enter the realm of turnaround when marginal underperformance has set in.

 

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