A past client of ALB Commercial Capital was exchanging out of Multifamily and diversifying into NNN properties out of state. This was one of 5 NNN properties that we were financing for the buyers.
The lease on these NNN properties are critical and in this situation the tenant would not agree to have the lender to be added as a loss payee to their insurance and per the lease they were not required to do so.
We were at a roadblock and running out of time and had no other options in meeting the lenders insurance requirements. The only way around this was the buyer had to obtain their own property insurance and list the lender as a loss payee. We were not happy about this, but sometimes you just have to do what you have to do.