A Basic Knowledge on Investment Grade Credit Tenants
A special financing offer for the landlords is what is called as the investment grade credit tenants and this is what you need to know first.
There is a rating agency that gives an investment grade rating for the company called as the investment grade credit tenant. If there is a property that is rented by the credit tenant then what will happen is that the lenders will offer a special financing. This is the kind of special financing that focuses on the value and the tenant in its lease payments in the future. The investment grade tenants does not focus on the credit of the landlord or the real estate.
The lenders of the investment grade tenants will based on the rating of the tenant. To sell the institutional investors and securitize the loans is the reason why this is done. A rating of at the very least a BBB- is what you need to know about the investment grade. Investing in similar products and bonds is as a matter of fact what a lot of investors would gladly do. It is actually the states and the cities that are the participants that have ranked in the investment grade credit tenants.
The long term loans can as a matter of fact be availed of by the landlords when they have investment grade credit tenants. To be able to refinance the property or even buy a property are some of the options that they have for the loans. The loans can also be structured in a way that is non recourse to the owner of the property. What will happen if one will push through with this option is that the personal liability of the landlord will be removed. The reason why this can happen is because of the fact that the underwriters will be relying on the lease value.
To be able to obtain the direct financing is as a matter of fact what the investment grade credit tenants can also do. The best way in order to be able to avail of this is to be able to enter the sale leaseback transaction. The lender that has an investment grade credit tenants now has the power to be able to sell and lease to an investor. On favorable terms the property owner will be able to earn cash. A higher loan to value is as a matter of fact what they can also have. What you need to know about this is that you will not be able to find this in the traditional commercial real estate loan.
For the property owners that are in need of the loans at the soonest possible time can in fact avail of the investment grade credit tenants. There is a great deal of benefits that people can enjoy with the investment grade credit tenants.