CASE STUDY
The Client:
A hospitality management group operating luxury hotels, resorts, and commercial spaces across the Southeast, the company has built a portfolio of high-end properties that demand constant executive oversight, property visits, and coordination across multiple locations. Operating in the competitive luxury hospitality sector where property condition, guest experience, and management responsiveness determine occupancy rates and revenue performance, leadership recognized that efficient executive travel was essential to maintaining operational standards across geographically dispersed assets. The company’s cooperative ownership structure—while providing strategic and financial benefits—introduced unique complexity to financial reporting and asset allocation processes that would complicate any significant capital transaction, particularly one involving specialized assets like private aircraft.
The Challenge:
The hospitality group faced multiple layers of complexity that made traditional aircraft financing nearly impossible. The company was transitioning from one aircraft to another, creating tight timing constraints that required close coordination with both the seller of the new aircraft and existing lenders to avoid operational gaps in executive travel capabilities. The target aircraft was a high-value, highly specialized asset that presented complex underwriting and resale considerations traditional lenders struggled to evaluate, particularly given the niche market for this specific aircraft type. Compounding these challenges, the purchase required creating a new entity with no existing financial track record to underwrite—a structure that immediately disqualified most traditional financiers who rely on historical performance data. Most problematically, the cooperative ownership model introduced unique risk factors and governance complexities around decision-making authority, asset ownership, and financial obligations that made conventional lenders hesitant to proceed despite the underlying strength of the hospitality operations and the strategic necessity of the aircraft for managing the property portfolio.
Solution:
First National Capital recognized that beneath the structural complexity lay a fundamentally strong hospitality business with legitimate operational needs and the financial capacity to support aircraft ownership. FNC approved $11 million in financing and worked closely with the company throughout the aircraft sourcing and selection process, providing aviation market expertise to ensure the chosen aircraft matched operational requirements and represented sound value. Understanding the importance of working within the existing capital structure, First National served as an extension of the company’s senior lender, supplementing the capital structure with transaction-specific expertise and flexible terms that addressed the unique challenges traditional lenders couldn’t accommodate. The financing was structured with progress payments that enabled the company to align capital deployment with its operational ramp-up and transition schedule, avoiding the need for large upfront capital outlays that could have strained liquidity during the aircraft transition period. First National provided a flexible lease arrangement that supported the group’s gradual integration of the new aircraft while preserving liquidity across broader business operations, ensuring the hospitality properties maintained the working capital necessary for seasonal operations and property improvements. Despite the structural complexities around cooperative ownership, new entity formation, and specialized aircraft considerations, the transaction closed smoothly and positioned the management team to better support their growing hospitality portfolio with enhanced executive travel capabilities.
It All Begins With A Conversation
We listen. We live out-of-the-box. We solve problems. And we get deals done. Let’s do this.
