|
Loan Guidelines
| Property
type |
Average
to good quality |
| Maximum
amortization |
5-
to 10-year loan term, 25- to 30-year amortization |
| Loan
to value |
80%
maximum |
| Debt
service coverage ratio |
1.20x
minimum |
| Age
and size |
- Stable, older renovated
properties with modern systems considered
|
| Design/construction |
- Layouts that maximize the
number of exterior offices preferred
|
| Market/location |
- Properties located in strong
central business districts or high-quality suburban
areas preferred
- Suburban buildings should be
located with frontage or a major road, or in an
established office park
- Medical office properties
should be on or near a financially viable hospital or
medical campus
|
| Lease
terms |
- Preferred 3-year minimum
lease terms
- Leases with protection
against operating expense increases preferred
|
| Tenant
mix |
- Diverse, multi-tenant
buildings with national, regional, and local tenants
preferred
- Single-tenant properties
considered with long-term lease; tenant should have
satisfactory financial strength
|
| Parking |
Ratio
must comply with local code and meet needs of specific
market: 4:1 parking ratio preferred |
|
|
Income Analysis Guidelines
| Consideration |
Guidelines |
| Rental
income |
- Based on lower of leases in
place or market rents
|
| Other
income |
Should
be stable, recurring, and a market norm |
| Economic
vacancy |
Equal
to the greater of market vacancy, actual vacancy, or 5% of
gross income |
| Effective
gross income (EGI) |
Rental
income plus other income, less economic vacancy |
| Management
fee |
Equal
to the greater of market or actual |
| Operating
expenses |
Greater
of latest full year or 3-year historical average |
| Net
operating income (NOI) |
EGI
less management fee, operating expenses and CapEx
reserves |
| Cash
flow |
NOI
less TIs and LCs |
|
|