Geoff Davis of HREC Investment Advisors

When it comes to working out troubled hotel loans, lenders have shifted from “extend and pretend” to “pay to play,” says Geoff Davis, president of HREC Investment Advisors. Meaning, he says, that borrowers need to put up more capital if they want to restructure a loan. If they cannot, “We could see an increase in foreclosures,” Davis says. Davis recently spoke with Maria Wood, hotels editor for GlobeSt.com and Real Estate Forum, about distressed hotel loans, the prospects for acquisitions and what signs will point to a lodging recovery.