Tax exempt bond financing is available where the tenant (or issuer of a direct obligation bond) is a nonprofit tax-exempt organization under Section 501(c)3 of the IRS Tax Code. If the financing is for a leased property, the property must revert to the lessee at the end of the lease term at a nominal price in order to qualify for tax exempt financing.
Loan Underwriting:
- 100% Financing
- 1.00x DSCR
- Bondable lease
- Loan amount includes construction interest and all soft costs
- Bonds can be credit enhanced up to "AAA" rating with insurance
- Investment grade or equivalent rated tenants/issuers
Loan Terms:
- $5 million to $1 billion
- 30/360 interest calculation
- Up to 30 years fully amortizing
- Semiannual payments of interest; annual principal payments
- Notes typically structured with serial maturities
- Closed to prepay for 10 years, then 3-2-1%-par prepay