Single-tenant net lease loans.
The basics
One building, one tenant, one lease. The lease document does most of the work in a net lease file, and lenders read it before they read anything else about the real estate.
A single-tenant net lease property is a bond wrapped in a building. The rent is contractual, the term is defined, and the tenant carries most or all of the operating cost. That simplicity is why net lease is one of the most heavily financed corners of retail, and it is also why the underwriting is narrower than most owners expect.
Lenders start with the lease. Who signs it, how long it runs, what the tenant is obligated to pay, and what happens at expiration. Everything else follows from those four answers. A property with strong corporate credit and a long remaining term will draw quotes from life companies and CMBS lenders that will not look at the same building with a short tail on the lease.
Where net lease files get decided
Term remaining versus loan term is the central issue in this asset class. When the lease outlasts the loan, the lender is underwriting rent it can see. When the loan outlasts the lease, the lender is underwriting your ability to re-tenant a building it has never had to lease. Those are different risks and they get different pricing, different amortization, and sometimes different lenders entirely.
Lease type matters almost as much. A true triple net lease pushes taxes, insurance, and maintenance to the tenant. A double net lease usually leaves roof and structure with the owner. A gross lease leaves nearly everything with the owner. Lenders underwrite the net number, so two properties with identical rent can support very different loans.
The third factor is rent level. If the tenant is paying well above what the space would command from a replacement, the lender sees a cliff at expiration. That does not stop the deal. It does shape how conservatively the file is sized and which lenders will engage.
Credit tenant versus franchisee
There is a real divide here and it is worth being direct about it. An investment-grade corporate guarantee behind the lease turns the deal into a credit story, and the deepest, cheapest capital in retail competes for it. A franchisee guarantee, a regional operator, or a personal guarantee turns it back into a real estate story, where location, rent level, and re-tenanting cost carry the file.
Neither one is a problem. They are simply different lender lists. Franchise-operated quick service, auto service, and medical retail get financed every week by banks and credit unions that know those business models well. What gets owners into trouble is assuming the credit-tenant terms they read about apply to a franchisee deal, then losing weeks discovering otherwise.
Tell us who signs the lease, how long it runs, and what you are trying to do. We take it to lenders who write on that specific profile rather than starting with whoever is nearest.
What lenders look at.
The things that move a single-tenant net lease file from "maybe" to a real quote.
Lease term remaining
This is the first thing a lender checks. Term remaining that runs past the loan term is the cleanest version of the deal. When the lease burns off before the loan matures, the structure changes and fewer lenders will look at it.
Tenant credit quality
An investment-grade corporate tenant, a large franchisee, and an independent operator are three different files. The stronger the credit behind the rent, the more the lender will treat the lease as the collateral.
Lease type and expense responsibility
NNN, NN, and gross leases push very different amounts of cost back onto the owner. Lenders underwrite to what you actually net after roof, structure, and capital obligations, not to gross rent.
Rent versus market
If contract rent sits well above what the space would fetch from a replacement tenant, the lender is looking at a gap. That gap drives how conservatively the file gets sized.
Real estate fundamentals underneath
Corner, access, traffic counts, building generic enough to re-tenant. Good real estate protects the lender if the tenant leaves, and it widens the pool of lenders willing to quote.
How these deals are usually structured.
Every lender prices differently and every file is its own case. Treat this as the shape of a typical single-tenant net lease deal, not a quote.
- Loan amount
- Generally $500,000 and up.
- Common capital sources
- Banks, credit unions, life insurance companies, CMBS, and private money. Credit tenant deals with long term often draw life company and CMBS interest.
- Typical purposes
- Purchase, refinance, cash-out refinance, and 1031 exchange acquisitions on a deadline.
- Rate structure
- Fixed and floating both exist. Long fixed terms are common when the lease term supports them.
- Timeline
- A soft LOI quote often within 24 to 48 hours once your scenario matches a lender's guidelines, and a hard LOI in one to two weeks.
Terms depend on the property, the sponsor, and the lender. Nothing here is a commitment to lend.
Other retail we finance.
Different property, same process.
Or see everything under retail.
Loan types we place on single-tenant net lease.
Single-tenant net lease questions.
Still have a question about single-tenant net lease? Start a request and our team will get you an answer.
No. National investment-grade tenants get the deepest lender pool and the most aggressive structures, but franchisee-operated and regional tenants get financed constantly. The lender set is different, and that is the part we handle.
It becomes a structure question rather than a decline. Lenders may shorten the term, adjust amortization, or ask for a reserve against the rollover. Tell us the lease expiration up front so we shop it to lenders who price that risk rather than avoid it.
Yes, though it routes differently. Construction and bridge capital typically carries a build-to-suit until the tenant is open and paying, then permanent debt takes it out. Plan both stages together.
Regularly. Net lease is one of the most common exchange targets, and the clock is usually the constraint. Come to us early in your identification window and we work backward from your closing date.
Only if you occupy the building yourself. SBA is for owner-occupied real estate. A single-tenant property leased to a third party is investment property, so it goes to conventional lenders instead.
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