Lenders for Government Contractor occupied buildings
I'm looking at a building for sale with a major government contractor as  tenant. Attractive terms and price\*. However the big asterisk is like most government contractors they have cancellation clauses with minimal notice due to the nature of winning and losing contracts. I happen to know this particular facility services several contracts, so it is not reliant upon a single make or break project. Are there any lenders that specialize in loans for these types of buildings? My usual bank is pretty against it because to them it effectively looks like a month-to-month lease and is asking for more down than I can swing. Any advice?
[{"id": "h2s0axr", "text": "I mean, it is a month to month lease.  How quickly can you relet?\n\nHave you called smaller lenders in town? Whats the delta on DP?", "replies": [{"id": "h2s1ij3", "text": "They want 40% down versus 25% typically. I also think they might just be generally hesitant, this would be the first loan I've gotten since 2019 so the lending environment has certainly changed. Asking the local lenders will be the next step. \n\nI know there are lenders that specialize in lending on GSA leased buildings so I was wondering if there was something similar to that for government contractors. \n\nThanks for the reply.", "replies": [{"id": "h2s8x68", "text": "Thats pretty substantial. Can you learn more about the tender they are currently on? If it has 1-2 years of budget left, perhaps that can work. What about the current lender on it? Or is it cash?", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h2s4iup", "text": "&gt;My usual bank is pretty against it...and is asking for more down than I can swing.\n\nIs that a commitment letter answer or an initial conversation from your bank? Even if it's initial discussion coming up from 60 to 75 seems unlikely...\n\nWhat about the current tenants helps your case that this is a stable property with little turnover risk?  Are these divisions of major contractors or several small companies working on and individual contract each? How long has each tenant been there? What are the nature of the contracts being performed there and why do you feel they will continue?", "replies": [], "depth": 1}, {"id": "h2s5nq9", "text": "Depends on the deal size and which govt tenant.  I am a mortgage broker and usually can only get those deals done with CMBS because of the kick out clauses.", "replies": [], "depth": 1}, {"id": "h2sdxgf", "text": "Will the sellers consider a VTB in the second position guaranteed against the performance of the government tenant? If the tenant leaves the second mortgage is forgiven. That would be my approach.", "replies": [{"id": "h2sqjsm", "text": "That's a good question. I suspect not but I will check.", "replies": [], "depth": 2}], "depth": 1}, {"id": "h2shq6s", "text": "be careful if the contracts are related.  While \"multiple contracts\" sounds great and risk mitigating it really isn't if they are likely to all get cut at the same time.  We dealt with an ICE contractor under Obama who we passed on, pretty sure Trump's admin terminated every program they would have used our property for, though probably hired them to do other stuff in other locations.", "replies": [], "depth": 1}, {"id": "h2sqfp0", "text": "I know some GSA specific lenders that will go nationwide", "replies": [{"id": "h2srodx", "text": "Would they consider a publicly listed company with government contracts? If so care to pm some names?", "replies": [], "depth": 2}], "depth": 1}, {"id": "h2tkyf2", "text": "Which country is this for?", "replies": [{"id": "h2u4riz", "text": "US", "replies": [{"id": "h2wwjb5", "text": "I know a few lenders, they may not be a bank, but do provide competitive prices.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h5xsl6q", "text": "What state is the property?", "replies": [], "depth": 1}]