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
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