Envoy's new program makes financing ground leases easier and less expensive than ever before -- and gives developers the ability to retain full control of their projects. The program will provide 100% of actual hard and soft construction costs for pre-leased, single-tenant ground lease transactions, up to $4 million. For more detailed info, download the flyer here.
Envoy’s president Ralph Cram will be featured on RealShare’s Capital Markets Update panel on Thursday, April 16, at 9:15 a.m., along with several other capital providers and originators from the net lease financing realm.
The panelists will share their thoughts on where the money is coming from, what it’s targeting and how they make the deals happen. The panel will also analyze the most popular capital structures and the short- and long-term outlook for the capital markets in the net lease space.
Ralph Cram, featured in the Globe St. interview, had this to say:
"Net lease properties between $1 million and $5 million with highly recognized tenant names are the most popular; they appeal to all buyer groups. The low price points allow small investors to purchase them with or without leverage and portfolios of small net lease properties give the large buyer, such as REITS and large Institutional buyers, credit and location diversification. Mortgage debt is more plentiful for these properties as well.”
The least popular property types, Cram asserts, “Are specialty use properties with less than five years remaining on their lease term, especially if the unit is a poor performer or the rent is above market.”
Still, the market is rife with opportunity, Cram contends.
“We are seeing leasing activity for both existing single tenant buildings and ground up development increasing. Also, the recent increase in retail tenant closures gives developers the opportunity to purchase vacant buildings and re-purpose or demolish them for tenants wanting to enter land constrained markets. We see this type of activity occurring especially on the East Coast and infill neighborhoods.”
To read the full Globe St. article, go here.
Envoy president Ralph Cram will be at the ICSC Triple Net Lease conference next month to take part in a discussion of the capital markets in the net lease sector.
Mr. Cram, who has underwritten, acquired or financed $1.5 billion of real estate assets in his 25 years in commercial real estate, will be a panelist on the Capital Markets Overview session (9:00 - 10:00 a.m., March 3), which will take a look at funding challenges and opportunities in the current market environment.
Mr. Cram will be joined by W. Kyle Gore from CGA Capital, Sean Keane from First Savings Bank and Mark E. West of HFF Dallas — with the panel moderated by Ken Carpenter, managing director of CCRE. So if you're seeking a financing solution, or just want to get a sense for the state of the capital markets, stop on by.
To arrange an in-person meeting with Mr. Cram, contact him at (847) 239-7250 or firstname.lastname@example.org.
Need capital to finance your 2015 development pipeline or for an immediate net lease transaction?
Envoy Net Lease Partners will be on hand at two upcoming industry shows to talk net lease financing solutions.
Envoy will be at Booth #406 at the CREF/Multifamily Housing Convention & Expo on Feb. 1-4 in San Diego, and will also be attending ICSC's N3 Triple Net Lease Conference on March 2-3 in Dallas as a Platinum Sponsor.
Envoy offers a wide range of gap financing solutions -- from construction loans and bridge loans to JV Equity financing.
To arrange a personal meeting with Envoy President Ralph Cram for either show call Mr. Cram directly at (847) 239-7250 or email email@example.com.
This past year was a busy one for Envoy. We provided a wide range of net lease financing solutions for developers nationwide -- from a bridge loan for a Walgreens Pharmacy in Chicago to a construction loan for a FedEx facility in Colorado.
Our various financing programs include:
Construction Loans, which offer up to 95% LTC financing in one construction loan with no back-end participation.
Bridge Loans, which provide up to 90% loan-to-purchase price loans for properties in transition.
JV Equity, which offers up to 95% equity financing for BTS net lease transactions.
Last week in Singapore, Ralph Cram, President and Manager of Envoy Net Lease Partners, took time out to present his thoughts on investing opportunities in the U.S. net lease real estate market with a local audience of investors and financial consultants.
Among Mr. Cram's comments:
"Asian real estate investment in the United States is thriving," Mr. Cram said. "In the past few years, Chinese nationals nearly doubled their investment in U.S. real estate from US$8.2 billion in 2012 to US$14 billion in 2013."
Mr. Cram noted that the U.S. net lease market has been growing in popularity and that foreign investors have become major acquirers of net lease properties as a wealth preservation strategy.
"In 2013 alone, nearly 50,000 net lease transactions occurred in the U.S. totaling US$104 billion, with the average investment equaling US$2.1 million," he said, adding that single tenant retail stores, office buildings, industrial properties and medical facilities all fall within the net lease property category.
"This real estate investment is accessible to a majority of high-net-worth investors for direct investment," Mr. Cram said. "They (net lease investments) are an ideal solution for long distance investors who desire a predictable, bond-like return."
Mr. Cram, who has underwritten, acquired or financed US$1.5 billion of real estate assets across all product types and U.S. domestic markets over his 25 years in commercial real estate, told the Singapore audience that as Asian investors and their wealth advisors look to invest in the U.S., "they should consider the U.S. Net Lease Market for capital preservation, appreciation, current income and liquidity."
Net lease properties are single tenant properties where the tenant’s initial lease term is a minimum of 10 years and it pays all property-related expenses (taxes, insurance and maintenance).
Envoy is pleased to announce the financing of a first mortgage for one of its net lease preferred clients -- an American Mattress developer -- the third transaction this year under the company's new high-leverage construction program.
The transaction allowed the developer to achieve 94 percent loan-to-cost construction financing for a pre-leased, single tenant 3,500 SF retail store located on an outparcel directly in front of Chapel Ridge Shopping Center in Fort Wayne, IN.
“This is our second construction loan with this developer, and our first where Envoy was the lead lender,” says Ralph N. Cram, Chief Operating Officer of Envoy. “We now have the ability to provide construction financing on a wide range of transaction sizes, from smaller build-to-suit projects, to working with senior lenders on larger transactions where additional funds are needed to secure 90%-plus loan-to-cost construction financing.”
Unlike many financing programs, including those offered by REITS, Envoy's doesn’t require the developer to sell the property immediately following construction.
Instead, the developer retains control of the property simply by paying off the construction loan and paying an exit fee. For many developers, this program represents the lowest-cost option for capital when compared to third-party equity and traditional bank construction debt.
Envoy's recent closing of a $2 million-plus loan in central Colorado for a FedEx ground package facility marks the company's entry into the industrial build-to-suit market.
The transaction, completed under a new construction loan program serving the capital needs of net lease preferred developers, allowed a FedEx preferred developer to achieve 95 percent loan-to-cost construction financing for a pre-leased, single tenant distribution facility located across from Eagle County Regional Airport.
Envoy worked in tandem with its senior bank partner to provide the subordinated financing as a part of a wrap construction loan for this package distribution facility that will serve the communities around the ski resorts of Vail and Beaver Creek.
“Envoy is pleased to have the opportunity to help FedEx Corp.," says Ralph N. Cram, Chief Operating Officer of Envoy. "And its preferred developer finance their ongoing expansion plans to meet their customers’ needs for faster delivery times.”
Ralph Cram, COO of Envoy Net Lease Partners, spoke to Matt Hudgins at RECon News about the state of the retail market and offered insights about the amount of new development we can expect to see in the coming year.
Click on the image at right to read the full story.
Our new Bridge Loan program offers developers and buyers with net lease, single tenant properties. The program provides up to 90% loan-to-purchase price short-term bridge loans for properties currently in transition.
To find out more about the program, download the flyer here.
Envoy provides hassle-free equity gap financing for net lease, single tenant properties — helping developers and buyers secure the capital they need, minus the red tape.
We offer three financing programs.
Construction Loans: Up to 95% LTC financing in one construction loan with no back-end profit participation.
Bridge Loans: Up to 90% loan-to-purchase price short-term bridge loans for properties in transition.
JV Equity: Up to 95% equity financing for build-to-suit net lease transactions nationwide.
Envoy’s High-Leverage Construction Loan program offers preferred net lease developers the capital they need — minus the red tape.
No Profit Participation.
“Envoy's program helps developers secure up to 95 percent loan-to-cost ﬁnancing for their pipeline of net lease development properties without the hassles associated with JV agreements or mezzanine loan documentation,” says Envoy COO Ralph Cram. “And they no longer have to give up control as is typical with pre-sale contracts. It’s everything the preferred developer has been asking for.”
Unlike many ﬁnancing programs available to developers, including those offered by REITS, Envoy doesn’t require the developer to sell the property immediately following construction.
Instead, the developer retains control of the property simply by paying off the construction loan and paying an exit fee. For many developers, the Envoy program can represent the lowest-cost option for capital when compared to third-party equity and traditional bank construction debt.
For more details on Envoy’s high leverage construction loan program, download our printable ﬂyer containing transaction criteria.