Credit Tenant Financing

Credit Tenant Lease (CTL) financing is governed primarily by the credit of the tenant and the lease. The CTL lease usually requires the Tenant to pay directly - their expenses for which they are responsible.  If the lease has the Tenant paying the Landlord, a funded reserve is required.

Typically, a credit rating by Standard & Poors of BBB- or better is required for the transaction to be considered 'investment grade'.  BB+ & less (non-investment grade) may be considered on a case by case basis.

LTV - can be as high as 100%.

DSC - Debt Service Coverage can be as low as 1.00x.

Single Tenant Financing - Non-Investment Grade Tenants occupying 100% of a building can still obtain favorable financing of up to 90% of the appraised value, but typically are financed at 75 to 80%, with DSC at 1.25x for up to 25 year amortizations.

Both deal types are structured on a deal by deal basis, depending on the quality of the Tenant, the Lease and location.  Give us a call to discuss any specific parameters and other factors that may impact the Lenders' underwriting.