Mesirow Financial Holdings Inc. of Chicago has hired Stephen Jacobson to build and lead its credit tenant lease team.
Credit tenant leases provide financing to owners of single-tenant commercial properties. The loan is secured by rents to be received from the tenant and by the property.
The tenants are investment-grade credits; the CTL market does not extend credit to tenants rated less than BBB-minus, Jacobson said.
"The investment market for CTL placements is ripe due to lenders seeking higher-yielding investment grade products," Jacobson said, which is one of the reasons Mesirow has started a CTL group.
In 2007 and 2008 the CTL market lost business to commercial mortgage-backed securities. After the decline of CMBS products, CTLs are back in favor and institutional demand from them is strong, Jacobson said.
Since CTL transactions are done as private placements, investors typically generate higher yields than they do for public offerings of the same credits.
At Mesirow, Jacobson is a senior managing director in the global markets group for the CTL product.
He joined the firm from William Blair, where he spent 15 years and established the firm's CTL group.
Mesirow plans to have a minimum of four CTL originators, Jacobson said.