La Quinta Franchisees Offered National Loan Program

DALLAS— La Quinta Inns announced August 1 it would offer qualifying franchisees a new loan program providing the most favorable terms available on SBA loans up to $5 million with CIT Small Business Lending. The goal, said Alan Tallis, evp/chief development officer, “is to offer support for our franchisees and make them as successful as possible.” Qualifying franchisees would have to be credit worthy, fall in line with SBA guidelines and be approved by La Quinta as a franchisee. Unlike many other programs sponsored by hotel franchisors, this program is not being sponsored by La Quinta, but is the result of a relationship the company has formed with CIT. In addition, it is unique in that it will provide loans of up to $5 million, which is considered sizable compared to other hotel companies which offer similar programs, but whose loans only go as high as $2 million or $3 million. The program is designed to offer those interested in franchising the La Quinta brand an alternative to commercial institutions, and ultimately is expected to provide them a lower interest rate on their loan that what they would traditionally be able to get if using other sources. “The current economic environment not withstanding, we feel responsible to enhance our franchisees’ ability to do business,” said Tallis, who noted that a side benefit of the program is the promotion of La Quinta’s fairly new franchise program. La Quinta first announced last year its plans begin franchising the brand. Earlier this year the company revealed its franchising strategy, which included the addition of 15 franchised hotels this year to its portfolio of 300 company-owned properties. Tallis said La Quinta is on target to add the 15 franchised hotels by year’s end. The next to open, he said, will be the La Quinta Inn & Suites at JFK International Airport in New York City. “We have seen a strong response to our [franchising program]”, he said. In addition to new construction La Quinta hotels, the loan program with Small Business Administration Lender, CIT Small Business Lending, will be available to franchisees that are interested in refinancing existing properties, said Tallis.