ENVOY ANNOUNCES NEW PROGRAM THAT PROVIDES 100% FINANCING FOR GROUND LEASE DEVELOPMENTS
Program is the first to offer project loans for 100% of land & construction costs
on pre-leased single-tenant ground leases
CHICAGO, MAY 14, 2015 — Envoy Net Lease Partners, LLC, a real estate finance company specializing in single-tenant, net-leased properties, today launched a new lending program that provides up to 100 percent loan-to-cost financing for developers, retail and restaurant companies involved in ground lease developments, up to $4 million per property.
Envoy is the first lender to offer 100% financing of ground lease development transactions. These transactions involve the acquisition and preparation of raw land to be leased long-term to a tenant company, which will construct its own building upon the site. Tenants like McDonald’s, Chase Bank and AutoZone use ground leases extensively to finance new unit growth.
Traditional lenders such as banks typically finance up to just 80% of the cost, forcing developers to seek an equity partner for the remaining funds — a route that adds substantial costs while taking away control.
“Our goal is to make ground lease transactions easier and less expensive than ever before,” said Ralph N. Cram, President of Envoy. “As a non-bank, we can be a more aggressive lender than banks, which are prohibited by regulation from providing this high a level of financing for ground leases even though they’re historically one of the safest forms of construction loans.”
“This program is unlike any in the marketplace today in that it fully funds ground leases and requires no back-end profit participation,” Cram added. “The developer retains 100% control.”
With the addition of the ground lease program, Envoy now offers developers four financing options for single-tenant, net lease properties: ground lease loans (up to 100% LTC financing); construction loans (up to 95% LTC); bridge loans (up to 90% loan-to-purchase price for properties in transition); and JV equity (up to 95% equity financing for build-to-suit net lease transactions).
Envoy Net Lease Partners
Based in greater Chicago, Envoy Net Lease Partners, LLC, is a real estate lender of short-term financing for single-tenant properties. The company provides needed capital in the form of high-leverage construction and bridge loans, as well as JV equity financing, for transactions in the $1 million - $10 million range that are often too small or complex to attract the interest of institutional investors and lenders.
Envoy seeks qualified projects and developer clients nationwide. For investment criteria and more details on Envoy’s various financing programs, please visit envoynnn.com.
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