Neptune has offices in San Diego and Dallas. HREC has offices in Denver, Los Angeles, Chicago, New York, Tampa, Boca Raton and Memphis. Armstrong, who prior to founding Neptune in 2001 was senior managing director of the hospitality practice at Insignia/ESG Hotel Partners, says the merger combines firms with complementary services and locations, "which should lead to more opportunities in the market."

"Even though hotel lending is slow right now, Neptune has a tremendous practice as mortgage brokers," Cahill says. "Adding Neptune enhances our ability to find debt for clients in a tough market," Cahill says. "In addition, when things turn around it enhances our capital markets and mortgage brokerage business."

HREC president Geoff Davis says Neptune's debt, structured finance and equity work complements what HREC is doing and where he and Cahill are headed with the practice. That path includes a new group focused specifically on note sales.

"Given Neptune's capital markets orientation we will have a national push on that," Davis says. "A lot of what we are doing right now is refinancing, finding non-apparent lenders to refi[nance] assets. A number of owners and lenders are facing maturity defaults and will need to be recast or restructured. Secondly, a lot of clients have options to buy their own paper back at a discount, and we are working on those scenarios with both recourse and non-recourse lenders."

Davis says the companies' clients have historically been hotel owners looking to acquire or refinance an asset. He expects that to change this year.

"I would guess that in 2009 the majority of our clients will be lenders," he says. "They will be looking to sell and restructure notes; they will have workouts and JVs, and also assets that they've taken back from borrowers. Out of 50 transactions right now about 10% are REO [assets that lenders have taken back from borrowers]. But I would suspect that by the end of the first quarter we probably will be marketing 20 or 30 REOs."