What You Need To Know About Investment Grade Tenants
Most of the time, credit rating is given to large national companies that issue public bonds. It is the one that is considered the counterpart of a credit store. There are several agencies that determine the rating of each company.
In a credit rating, you will be able to see two categories. The moment that the credit rating has a BBB or Baa3 rating then your company is considered as an investment grade rating. It is by not reaching the former rating that the credit rating that you will get with your company is a non-investment grade. It is when you will get an investment grade rating that the credit that you have had a very low chance of it not getting paid. The financial status of every company is being checked once in a while by the agencies that provide the ratings that is why the ratings will change over time as well.
There are a number of big and medium size companies that are already having an investment grade rating. It is referred to as credit lease the moment that the company will lease a property and the tenants that made that lease possible is known as the credit tenants.
One sure fact the moment you have a credit tenement that leases your property is that you will get the monthly payment every time if you are there of the property. It is when you have a credit tenant in your building that the property value of it will increase as well. It is this advantage that you will get the moment that your credit tenants will have a long-term lease on your property. An added benefit to the owner of the building which is called as a triple net lease is when a tenant will handle the insurance, operating expenses, taxes of the property. Without thinking much of the landlord, the tenant will have better control on the property. But the landlord must also know that this set up will have lower rent.
The tenant that will lease your property should be considered by you when you are the building owner. It is when you have an investment property that the bank will also check the credit score that you have before they will be lending you money. It should be that the exchange will not be difficult. In completing the exchange, there will be an investor’s guide.
It is the institutional investor that will provide the credit-tenant financing and they will not often have any obligations with regards to the landlord. The coverage of this factor is under the triple net terms. The length of the lease is the one that will match the loan term. The landlord will not be thinking of anything as the tenant will carry the responsibilities.
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