$5M NNN Sale-Leaseback | Commercial Lending Solutions 
Loan Size Example

$5 Million NNN Sale-Leaseback Financing

By Trevor Damyan, Commercial Mortgage Broker at Commercial Lending Solutions

A $5 million NNN sale-leaseback at the national level represents a sweet spot for single-tenant net lease financing: large enough to attract institutional capital, but small enough to move through underwriting and closing in 60 to 90 days. Most deals at this size feature investment-grade or solid sub-investment-grade tenants on 10 to 20 year leases, with cap rates ranging from 5.5 to 7 percent depending on tenant credit and property condition. Lenders competing for this segment include national banks with formalized STNL platforms, life insurance companies, and regional debt funds, all chasing steady, predictable cash flow with minimal operational risk. Rates hover around 6.10 percent for conventional fixed structures, with leverage typically landing at 65 to 75 percent LTV for quality credits.

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Capital Stack

What a $5M NNN Sale-Leaseback Capital Stack Looks Like

Capital stacks for $5 million NNN sale-leasebacks nationwide are usually simple: a single first mortgage held by a national bank, life company, or CMBS conduit. Lender selection is driven by tenant credit quality, lease term remaining, property geography, and sponsor appetite for non-recourse versus full recourse. Life companies and banks with large STNL portfolios dominate this size because the economics justify the underwriting effort and the credit profile supports long hold periods.

Capital Source Rate / Cost Size / LTV Notes
National bank with STNL program 6.05 to 6.25 percent fixed, CMT-based or SOFR-based available $3.25M to $5M at 65 to 75 percent LTV Full recourse standard, 10 year amortization typical, 25 to 30 year term, non-recourse carve-outs available at 60 to 65 percent LTV. Fastest closing for investment-grade tenants.
Life insurance company 6.00 to 6.40 percent fixed, longer hold appeal $2M to $5M at 60 to 70 percent LTV Recourse or non-recourse depending on structure and LTV. Patient capital, willing to hold 20 plus year terms. Underwriting slower but rate advantage for longer leases.
CMBS conduit lender 6.15 to 6.50 percent, spreads over benchmark $5M to $7.5M at 70 to 75 percent LTV Full recourse, fixed rate, 25 year amortization. Stronger for multi-asset portfolios or slightly stressed credits. 90 to 120 day closing timeline.
Regional or specialty credit union 5.95 to 6.25 percent, member-oriented pricing $1.5M to $4M at 60 to 70 percent LTV Full recourse, typically shorter hold periods, strong for local or regional tenants. Faster decisions, less documentation than banks.

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 Sale-Leaseback Deal

Typical sponsors closing $5 million NNN sale-leasebacks nationwide range from experienced 1031 exchange buyers with $10 to $50 million net worth to institutional real estate platforms managing mid-market portfolios. Many are executing refinances of older non-recourse debt or acquiring stabilized properties from corporate sale-leaseback programs. These sponsors usually have prior net lease experience, clean balance sheets, and are motivated by stable yield and portfolio diversification rather than value-add upside.

From the CLS CRE Pipeline

A Real $5M Example

CLS closed a $5.2 million NNN financing on a newly constructed automotive service facility in the Southeast regional market for a credit tenant with 15 years remaining on the initial lease term and two five-year renewal options. The loan came in at 72 percent LTV, 6.12 percent fixed, 25 year amortization, with full recourse and a 10 year prepay lock. A national bank with a dedicated STNL team underwrote and funded in 68 days. The sponsor was a 1031 exchange buyer downsizing from a larger portfolio, and the non-recourse bid came in 40 basis points higher; the full recourse structure made the most sense for the exit timeline.

Anonymized. All deal references protect borrower and lender identity.

FAQ

$5M NNN Sale-Leaseback FAQ

Most lenders will offer 70 to 75 percent LTV for investment-grade credit and long lease term. A few life companies will push to 75 to 80 percent if the tenant is A rated and the lease has anniversary increases. Expect 65 to 70 percent LTV if the lease is closer to 10 years or the tenant is sub-investment grade.
Yes, but expect to give up 30 to 50 basis points in rate and typically accept a lower LTV (60 to 65 percent). Non-recourse is most common with life companies and specialty debt funds; banks and conduits strongly prefer recourse, especially at this loan size where the credit profile and lease structure are critical.
Banks with streamlined STNL programs can close in 45 to 60 days. Life companies typically take 60 to 90 days because of longer underwriting cycles. CMBS conduits usually run 90 to 120 days. Have all financial statements, leases, and title work ready upfront to accelerate the timeline.
CMT-based pricing for banks remains anchored to the 10 year Treasury curve, currently trading in the 4.0 to 4.5 percent range, with lenders adding 160 to 180 basis points for credit spread and servicing. Life companies pricing off longer indices tend to be 5 to 10 basis points cheaper. CMBS spreads have normalized to 140 to 160 basis points over comparable benchmarks.
Lock immediately after a verbal indication from your lender's loan committee; rates can move 10 to 25 basis points intra-day, and most lenders allow 30 day locks at no cost for qualified sponsors. This protects you from surprise repricing during the 60 to 90 day closing period and keeps the sponsor's returns predictable.


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