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Crucial Facts You Need To Know About Investment Grade Tenants
Any large national companies that issue public bonds are being given credit rating. It is the one that is considered the counterpart of a credit store. You will be able to see a number of different agencies that provides the credit rating of the corporation.
When you are talking about credit rating, you will be able to see two kinds of 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. The credit that you have once you will get an investment grade rating is that it has a lower chance for it not to get paid. It is the agencies that give out the rating that constantly checks the financial status of every company and the rating will change over time.
There are a number of big and medium size companies that are already having an investment grade rating. It is the tenants that made the lease that are called as credit tenants and when they lease a property, referred to as a credit lease.
As the businesses continues if the credit tenants, the owner if the building, on the other hand, will enjoy being paid every month for the rent of his building and that is a sure fact. Once there will be credit tenants that lease your property, the building that you own will have a higher property value. You can definitely get this especially if the lease that they have is a long term. The insurance, operating expenses, taxes of the property can be handled by the tenant in what is called as a triple net lease which is an added benefit to the owner of the building. Without thinking much of the landlord, the tenant will have better control on the property. The building will have a lower rent once this set up is used.
If you are a building owner, it is important that you will consider the credit strength of the tenant that will lease your property. Before the bank lends you money, they will first check the credit score that you have especially for your investment property. It should be that the exchange will not be difficult. There is an investor guide that will take help you in completing the exchange.
It is because the institutional investors that will provide the credit-tenant financing, they will not be liable to any 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 responsibilities will be carried out by the tenant and not the landlord.
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