All Forum Posts by: William M.

I haven't found any accounting information on this subject. But i do believe due to the structure of the financing in which the loan is sized to a 1.00x to 1.10x Debt Service Coverage Ratio, there is typically little to no cash flow available to the borrower after debt service. Instead, those cash flows are monetized upfront, thus requiring the borrower to make a smaller equity contribution or, in some cases, receiving cash at funding(Source: Click Here). I would to make this work to even be able to receive a small amount from the proceeds. Could you explain the lender you spoke of that buried 400k of cost into the deal and explain what that means. Thanks for your comment!

I would like to know if anyone has any experience with utilizing CTL Loans to purchase Absolute NNN properties or knows of their structuring? My goal is to purchase Absolute NNN properties to create passive income for myself. But the down payment required on NNN properties is so large and without that it's difficult to get financing. I've done some research on CTL lenders but I don't know if you'd still be able to receive income from a property even after all expenses are paid. Are all proceeds used to pay the loan off? Some CTL lenders provide 100% LTC/LTV and in some cases even more. Is there a way to structure these deals(syndication) with minimal funds out of pocket while being able to close and have passive income? Thanks for you input!

I'm looking for a lender to lend 20% of the ARV of the properties I find in NC for 3-6 months. I work with a partner  that flips properties but I only need to provide the 20%. What return do you expect on the money you lend and do you offer a balloon payment or no payment options?

 We're you able to find the private investors you needed to close on these properties. I am looking to do something similar. Thanks and Happy New Year!

 Thank you Mr. Carroll. These are the exact lenders I have been researching. I believe you are correct for this deal because it's an assumption but the time period left on the lease is more than 15 years(20+ years). I have found properties with investment grade tenants. Some of which have new leases that will commence next year. Please message me with the details and please refer to my post in the marketplace. Thank you for your time and Happy New Year!

Hello to the BP community,

NesMac Investments is in search of private investors interested in partnering to have a debt and/or equity position for Absolute NNN properties located primarily in the state of North Carolina.

There are a selection of lenders who can lend up to 100% LTV/LTC for these types of properties. These loans are supported by a long term lease from a credit tenant (Walgreens, CVS, Wal-Mart, etc.). NesMac is in need a credit partner, with qualification ability, who can fund closing cost, inspection fees that may be part of the application, and deposit fees that may be required before and/or after loan commitment which may be refundable at closing. There are properties that have been selected to pursue, some of which are new construction whose leases will commence next year. If interested, please send a message to discuss these lenders, properties selected, and JV solutions/specifics. Thank you for your time.

Thank you for you comment. I have yet to find out a lot of information about this deal because of the holidays. I have discovered that there is a 1% assumption fee for the loan as well as qualification requirements. And I will update when I find out more about how the loan is structured. I have found lenders who lend up to 100% LTV/LTC for these types of commercial properties. But with this comes inspection fees with the application and deposit amounts that are a percentage of the loan that may be required before and/or after the signing of the commitment to the loan which may be refundable after the closing. But I am determined to make this work. Thank you and have a Happy New Year.

 Thank yous Eliana and Merry Christmas to you.

Property Details:

Purchase Price: $9,500,000

Annual Rent: $498,804

Cap Rate: 5.25%

Lease Expiration: 2/28/2038

Lease Type: NNN

Year Built: 2013

Options: 10, 5-year

Gross Leasable Area: 14,534 SF

Building Class: B

Lot Size: 3.20 AC

Tenancy: Single

No. Stories: 1

Assumable debt:

Wells Fargo Loan Balance: $4,728,897

Interest Rate: 4.5%

Amortization: 30 years

Annual Payment: $304,011

Cash-on-Cash Return: 4.01%

Lease abstract:

Tenant: Walgreens

Guarantor: Walgreens Boots Alliance, Inc. (NYSE: WBA, S&P: BBB+)

Lease Structure: Absolute triple-net

Lease term remaining: 21+ years

Lease expiration: 2/28/2038

Options to extend: 10, 5-year options to extend

Landlord responsibilities: None. The tenant is responsible for all repair and maintenance of the property, including the roof and structure.

Site demographics:

Average Daily Traffic Count (ADT): 23,000

1-mile Average Annual Household Income (AHHI): $99,969

POPULATION:

1-mile radius: 6,095

3-mile radius: 42,886

5-mile radius: 124,077

Questions(using the information provided above):

1. How does assuming the debt of commercial properties work in general, and specifically for NNN properties?

2. What requirements may need to be met by the lender and can bringing on an equity/funding/credit partner help close such a deal?

3. Is there usually a down payment required? How much should I expect?

4. Am I simply assuming the balance on the loan or paying the listed price?

5. Is it possible to do a seller carry back for the down payment?

6. Is it possible to positively leverage(100% financing scenario) such a deal using creative financing(private lender(s), hard money loan, etc.?

I'd like to request for a referral for a private money lender that directly lends there own funds who may be interested in doing a JV on the property. Please let me know if you need any additional details.

Property Details:

Purchase Price: $9,500,000

Annual Rent: $498,804 

Cap Rate: 5.25%

Lease Expiration: 2/28/2038

Lease Type: NNN

Year Built: 2013 

Options: 10, 5-year

Gross Leasable Area: 14,534 SF

Building Class: B

Lot Size: 3.20 AC 

Tenancy: Single 

No. Stories: 1

Assumable debt:

Wells Fargo Loan Balance: $4,728,897 

Interest Rate: 4.5% 

Amortization: 30 years 

Annual Payment: $304,011 

Cash-on-Cash Return: 4.01%

Lease abstract:

Tenant: Walgreens 

Guarantor: Walgreens Boots Alliance, Inc. (NYSE: WBA, S&P: BBB+) 

Lease Structure: Absolute triple-net 

Lease term remaining: 21+ years 

Lease expiration: 2/28/2038 

Options to extend: 10, 5-year options to extend 

Landlord responsibilities: None. The tenant is responsible for all repair and maintenance of the property, including the roof and structure.

Site demographics:

Average Daily Traffic Count (ADT): 23,000 

1-mile Average Annual Household Income (AHHI): $99,969 

POPULATION: 

1-mile radius: 6,095

3-mile radius: 42,886 

5-mile radius: 124,077 

Questions(using the information provided above):

1. How does assuming the debt of commercial properties work in general, and specifically for NNN properties?

2. What requirements may need to be met by the lender and can bringing on an equity/funding/credit partner help close such a deal? 

3. Is there usually a down payment required? How much should I expect?

4. Am I simply assuming the balance on the loan or paying the listed price?

5. Is it possible to do a seller carry back for the down payment?

6. Is it possible to positively leverage(100% financing scenario) such a deal using creative financing(private lender(s), hard money loan, etc.?

Thanks for everyone who helps me this and Merry Christmas to all!