In a true triple-net deal the lease is the asset. The tenant carries taxes, insurance and maintenance, the landlord’s obligations are thin, and the loan is effectively secured by a credit tenant’s promise to pay rent for a stated number of years.
What the file turns on
The tenant’s credit, the remaining primary term against the proposed amortisation, whether the guarantee is corporate or franchisee, and the rent escalations.
Where deals fail
A lease with less remaining term than the loan, a franchisee guarantee priced as though it were corporate, and above-market rent that flatters the cap rate and will not survive renewal.
Read the lease, not the label
Plenty of leases marketed as NNN leave the roof, structure or parking lot with the landlord. That is a different risk and it should be priced as one.
Our minimum loan is $200,000. We are a direct commercial lender working across the 43 states we serve, in business since 1998. We do not publish a rate for this product because the number depends on the file — call and we will quote the deal in front of us.
Commercial Lease Types and How They Change a Loan · Government-Leased Property Financing · Ground Lease & Leasehold Financing · Investment property financing · All property types