Is financing typically used in STNL lease properties??
In a conversation I heard someone mention financing isn’t typically used in STNL properties like a Dollar General or Burger King, is this true? I understand institutional players buy them cash just as a constant stream of income but do people also purchase them leveraged? Why or why not?
[{"id": "iq6g656", "text": "Institutional buyers typically have portfolio debt and aren\u2019t subject to the same financing constraints as individuals. I would say the majority of private buyers utilize financing, most of which get 50-70% LTV. Yes, there are some 1031 buyers who pay all cash but almost every  non-exchange buyer gets a loan and I\u2019d say at least 50% of exchange buyers get a loan.", "replies": [{"id": "iq9muyi", "text": "Came here to say basically this. I have not heard that financing isn't used for STNL properties before, but if that is a vague consensus it is likely because larger, institutional buyers don't have financing contingencies for closing the acquisition of individual assets.\n\nI would add that financing rates on STNL properties (particularly with long term credit tenancy) are generally competitive relative to other asset classes in the same way cap rates are.", "replies": [], "depth": 2}], "depth": 1}, {"id": "iq93sjy", "text": "There is financing behind everything, including cash deals.", "replies": [], "depth": 1}]