| CREDIT TENANT FINANCING
We can provide high leverage financing for investment grade tenants. The following are ratings used to determine investment grade status.
| Investment Grade |
Non-investment Grade |
|
AAA
|
BB
|
|
AA
|
B
|
|
A
|
NR (not rated)
|
|
BBB
|
|
Examples of Investment Grade firms:
| Costco |
A |
| CVS |
A |
| Detroit Edison |
BBB+ |
|
Diageo, PLC
 |
Burger King |
|
A+ |
| Dillards |
BBB- |
| Eastman Kodak Co. |
A+ |
Examples of Non-Investment Grade firms:
| K-Mart Corp. |
BB+ |
|
| Ohio Edison Co. |
BB+ |
Positive |
| Owens-Illinois, Inc. |
BB |
|
| Pep Boys |
BB- |
|
| Saks, Inc. |
BB+ |
|
| Sea Containers, Ltd. |
BB+ |
Negative |
OPTIONS BASED ON NNN LEASE TYPE
|
Loan To Value
|
80-100%
|
|
NNN
|
80-90%
|
| NNN/ABSOLUTE |
90-95%
|
Borrower should have a NNN lease with tenant.
TWO TYPES OF NNN LEASES
NNN - all expenses except roof and structure paid by tenant.
 |
80-90% LTV |
NNN / ABSOLUTE BONDABLE - all expenses paid by tenant
|
90-95% LTV |
A NNN lease requires less maintenance by the borrower. The tenant pays all related expenses and the lease is usually long term (15+ years).
Public companies want Credit Tenant Financing because they do not want an added asset on their balance sheet. They prefer to lease rather than purchase property. |
