$5M NNN Acquisition Chicago | Commercial Lending Solutions 
Loan Size Example

$5 Million NNN Acquisition in Chicago

By Trevor Damyan, Commercial Mortgage Broker at Commercial Lending Solutions

A $5 million NNN acquisition in Chicago reflects strong investor appetite for stabilized single-tenant net lease properties across the metro area's core submarkets. Borrowers at this loan size typically target investment-grade or solid regional tenants with 8 to 15 year lease terms, driving predictable cash flow and attractive cap rates in the 5.50 to 6.75 percent range. Lenders in this pool include national banks with established STNL programs, regional credit unions, and life insurance companies that view Chicago's diverse tenant base and dense urban corridors as low-risk deployment. Rates in the current environment sit around 6.75 percent on a 10-year CMT-indexed structure, with LTV ranging from 65 to 75 percent depending on tenant credit and lease maturity.

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Capital Stack

What a $5M NNN Acquisition Capital Stack Looks Like

Capital stack decisions for a $5 million NNN deal in Chicago hinge primarily on tenant credit rating, remaining lease term, and the borrower's equity position. National banks dominate this loan size because they can execute quickly, offer competitively priced CMT-indexed rates, and provide non-recourse products at reasonable LTV thresholds; life insurance companies step in when borrowers target slightly lower leverage or longer amortization periods and are willing to accept longer closing timelines.

Capital Source Rate / Cost Size / LTV Notes
National bank with STNL program 6.65 to 6.85 percent fixed, CMT-indexed $3.5M to $4.25M at 70 to 75 percent LTV Fastest execution, 30 to 45 day close, non-recourse available below 70 percent LTV, minimal tenant substitution restrictions
Life insurance company 6.50 to 7.00 percent fixed, 15 year amortization standard $2.5M to $4.0M at 65 to 72 percent LTV Longer close (60 to 90 days), loan packages limited to investment-grade tenants only, interest-only periods available, competitive for long-hold 1031 exchange buyers
Regional credit union 6.70 to 6.95 percent, 10 year fixed or ARM $2.0M to $3.5M at 60 to 70 percent LTV Relationship-driven pricing, 45 to 60 day close, local market expertise, recourse to borrower net worth, tight tenant credit requirements
CMBS conduit 6.80 to 7.10 percent plus 0.50 to 1.00 percent servicing, 12 year amortization $4.0M to $5.0M at 70 to 75 percent LTV Pooled product, 45 to 60 day execution, lower pricing if deal stacks with 2 to 3 other Chicago NNN assets, non-recourse, minimal flexibility on loan terms post-closing

Pricing reflects active CLS CRE quote pipeline as of April 2026. Specific deal pricing depends on sponsor, property, and structure.

Sponsor Profile

Who Closes a $5M NNN Acquisition Deal

Typical borrowers at the $5 million NNN level in Chicago include 1031 exchange investors with $2 million to $5 million in replacement property equity, multi-property operators looking to consolidate holdings in secondary urban markets, and experienced net lease buyers with 5 to 15 prior acquisitions under their belt. These sponsors often operate with $1 million to $3 million in liquid reserves, maintain strong relationships with brokers and debt advisors, and are motivated by stable income, tax-deferred growth, or portfolio rebalancing rather than value-add upside. They view Chicago as a mature, tenant-rich market where quality single-tenant boxes with credit anchors (QSR, convenience retail, automotive service) offer reliable 15 to 20 year hold strategies.

From the CLS CRE Pipeline

A Real $5M Example

We closed a $4.85 million acquisition financing for a net lease office-supply tenant property in the northwest Chicago submarket in late 2024. The borrower, a repeat 1031 exchange buyer, targeted a property leased to an investment-grade tenant with 11 years remaining on its lease and a 5.95 percent in-place cap rate. We placed the loan with a national bank at 6.68 percent fixed on a 10-year CMT index, 72 percent LTV, 25 year amortization, and non-recourse structure. Close occurred in 38 days from application, and the borrower has since added three more Chicago-area properties to the portfolio using proceeds from the refinance of an earlier 1031 exchange acquisition.

Anonymized. All deal references protect borrower and lender identity.

FAQ

$5M NNN Acquisition Chicago FAQ

Most national banks and life companies require BBB-minus or better from Moody's or S&P, or investment-grade equivalent. Regional credit unions may accept BBB properties if the lease term is 10 years or longer and the sponsor has strong net worth. CMBS conduits typically cap exposure to single-A and above unless the deal is pooled with stronger assets.
Yes, non-recourse is standard at 70 percent LTV or below with national banks and CMBS lenders, provided the tenant credit and lease term meet underwriting standards. Life insurance companies may offer non-recourse at 65 to 68 percent LTV. Lower leverage and longer lease terms improve non-recourse pricing and availability.
National banks typically close in 30 to 45 days from full application. Life insurance companies average 60 to 90 days due to underwriting depth and internal approval cycles. CMBS conduits range from 45 to 70 days depending on pool capacity and secondary market conditions. Early engagement with your CRE broker accelerates pre-approval.
Most STNL programs use the Constant Maturity Treasury (CMT) index, which resets based on 10-year U.S. Treasury yields. Fixed-rate programs are also common and lock your rate for 10 to 15 years. For 1031 exchange buyers, fixed-rate structures simplify financial projections over long hold periods and reduce refinance risk if rates rise.
Investment-grade tenants with 10 to 15 year leases in strong Chicago submarkets (North Shore, downtown-adjacent, near O'Hare) are trading at 5.50 to 6.50 percent cap rates. Secondary locations and shorter lease terms push toward 6.25 to 7.00 percent. Your financing rate of 6.75 percent leaves modest cushion, so underwriting the tenant's lease renewal likelihood and the property's retenanting risk is essential.


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