If you plan to build, expand, or renovate a hotel in Quebec, traditional bank loans may not be enough. PADAT Stream 2—part of the Program Supporting the Development of Tourist Attractions—offers government-backed financing designed for hotel projects. Funding ranges from $100,000 to $5 million and can cover up to 90% of eligible project costs in some regions.
PADAT Stream 2 (Fonds de financement pour les établissements hôteliers) is a repayable financing program. It is administered by Investissement Québec for the Government of Quebec. The program supports hotel development projects that boost regional tourism.
PADAT Stream 2 supports hotel projects such as:
Important location rule:
Hotel construction projects in the metropolitan regions of Montréal or Québec City are not eligible under this stream.
To be eligible, you must operate in Quebec and fit one of these categories:
Your business must also show medium-term profitability. This means you need to prove your hotel will earn enough to pay back the loan.
PADAT Stream 2 offers repayable loans. The terms depend on your organization type and where your project is located.
You must provide at least 10% of project costs from private sources. This can be your own money or a conventional loan.
Since this is repayable financing, it is not usually considered taxable income. Many grants are taxable, but loans like PADAT Stream 2 are different.
PADAT Stream 2 accepts applications all year. There is no fixed deadline.
Prepare your project plan
Show financial viability
Submit your application to Investissement Québec
If you’re unsure about eligibility, tools like GrantHub’s eligibility matcher can help you check if PADAT Stream 2 fits your project and find other Quebec tourism programs to combine with it.
Thinking PADAT Stream 2 is a grant
It is a loan. You must repay the funds. Your ability to pay back will be checked.
Applying for projects in Montréal or Québec City
New hotel construction in these cities is not allowed under PADAT Stream 2.
Not securing enough private funding
You need at least 10% of project costs from non-government sources.
Weak profitability projections
Investissement Québec expects clear proof your hotel will be financially stable.
Q: Is PADAT Stream 2 a grant or a loan?
PADAT Stream 2 is a repayable loan, not a grant. You must pay back the money under agreed terms.
Q: How much funding can I receive?
You can get between $100,000 and $5 million, covering 50% to 90% of eligible costs. The amount depends on your organization type and project location.
Q: Are hotel projects in Montréal or Québec City eligible?
No. Construction projects in these metropolitan areas are not eligible.
Q: Who can apply for PADAT Stream 2?
Eligible applicants include for-profit hotels, non-profits, cooperatives, Indigenous organizations, and community groups in Quebec.
Q: Do I need to invest my own money in the project?
Yes. At least 10% of total project costs must come from private sources, such as equity or commercial loans.
PADAT Stream 2 can cover a big share of hotel development costs. It works best when you combine it with other provincial or regional funding. If you want to compare PADAT Stream 2 with other hotel programs, GrantHub tracks hundreds of active grant and loan options across Canada. This makes it easier to find the best fit for your hotel project before you apply.
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