STORE Capital is planning a $277.50 commercial mortgage securitization, according to a presale report from Standard & Poor’s.
S&P has assigned a preliminary 'A+' rating to $260 million of class A notes and a 'BBB' rating to $17.5 million of class B notes.
Credit Suisse is the sole bookrunner and structuring advisor.
The transaction is backed by net leases on 579 commercial real estate properties that are, in turn, secured by fee titles to commercial properties across various industry sectors, including related rents due under triple-net leases and hybrid leases with the properties' tenants.
The LTV on all the series is 70%.
In a net lease, the lessee agrees to pay a share or all of the common expenses of operating the property apart from paying the lease. A hybrid lease is composed of a ground lease--or sublease for properties in which the issuer has a ground lease interest--on the land and a mortgage on the building.
The deal is structured with a six-month prefunding period, which S&P said “gives the issuer flexibility to acquire additional properties after the closing date.” At the transaction’s closing, $30 million of note proceeds will be deposited into a segregated account.
STORE, headquartered in Scottsdale, Ariz., was formed in 2011 to invest in single-tenant operational real estate, including restaurants, furniture and home improvement stores, educational and daycare facilities, movie theaters, and service and distribution facilities. STORE's principal equity investors are investment funds managed by Oaktree Capital Management L.P.