grade entities into cash that can be used for any business purpose.
Real Estate and Infrastructure
We are well positioned, especially in tight credit markets, to fund triple net leases – a leasing arrangement in which a tenant is responsible for payment of rent on a property, and is also responsible for all other expenses associated with that property, including and not limited to maintenance and repairs, real estate taxes, etc.
The tenant’s responsibility runs for the duration of the lease, allowing the owner of the real estate to “set it and forget it,” since the lease payments cover all property-related expenses.
If the tenant is an investment-grade rated entity, we can provide Monetization Financing and provide the owner with a lump sum payment equal to the present value of the future lease payments, at attractive fixed rates, without fees and without recourse to the owner.
We are also well positioned to fund new construction and development when at least one of the partners in the deal is an investment-grade rated entity.
We have the ability to provide funding at competitive rates and even defer the start of repayment until the project is completed. We will work with you to determine your capital requirements and the appropriate repayment schedule that translates to a present value equal to the capital
The agreement can be structured as a development, capital contribution or similar agreement with minimum required payments over time and as a result it will not be treated as debt on the books of the investment-grade rated Obligor. Further, the funds are provided on a non-recourse basis to the borrower.
Sample Transaction :
ABC Company is an investment-grade rated company with a division that specializes in construction of large
ABC Company has an option on a tract of land in a major US city that it wants to develop a 50 story office tower on.
They require $400MM to acquire the land and build the building.
ABC Company can enter into an agreement with us agreeing to make required minimum payments in the future, the present value of which is $400MM.
At closing we would provide ABC Company with the $400MM that they need to complete the acquisition and fund the construction.
There are many benefits to ABC Company utilizing Monetization Financing for this project.
In addition to low fixed rates, no fees or equity, nor the need to tap existing lines of credit, the repayment schedule can be set up so that repayments don’t commence until the project is near completion or completed.
Another Example: Real Estate and Project Funding for Cities and Counties
As a result of the current credit crises and devalued city and county budgets, many developers are unable to finance the development of buildings that would be utilized for municipal purposes (prisons, police stations, city halls, general economic development etc.) and as a result the Developer and the Cities and Counties suffer and stagnate.
We offer several creative solutions to finance such transactions without creating debt on the City/County balance
- Sale leasebacks for buildings that don’t require appropriations clauses.
- A Developer is prepared to build a building which will be 100% leased by the City/County or one of many Authorities of the City/County or investment grade corporate tenant; City/County enters into a partnership with the developer whereby they get a small amount of equity and in return would agree to cover any unlikely debt repayment shortfalls via a Capital Contribution Agreement; City/County comfortable b/c it knows that it
and/or it’s authorities are entering into long term leases which would provide the NOI to pay the debt service.
Where Monetization Financing Works Best:
- Service and Supply Agreements
- License Agreements
- Energy Savings Contracts
- Waste-to-Energy Facilities
- Renewable Energy and other Green Initiatives
- Real Estate and Project Funding for Cities and Counties
- Deferred Compensation
- Real Estate and Infrastructure
- Funding for Government Programs and Projects
- Monetization Financing vs Traditional Funding
- Monetization Financing Benefits
- Monetization Financing FAQ’s
Simply stated we offer the best financing package available to investment grade entities – low interest rates, no equity or board seats, no covenants, no oversight and done in a quick and efficient manner.
Industries Where Monetization Financing is Working:
- Waste Management
- Water Purification
- Green Energy (Power Purchase Agreements)
- Waste-to-Energy Facilities
- Wind Turbines and Solar
- Oil and Gas
- Wastewater Treatment Plants
- Food Processing
- Nearly all industries can be approved!