It's tricky, because everyone comes to projects with wildly different situations. Some have cash, some don't. Some have a building they have access to, some can't find a space. Some are new businesses, some are existing and growing. Some can pay very high rent with higher returns, and other people can't make that work. All of those factors mean that it's all over the place, but if you have a lot of debt, you better have a very high-producing business model, which a lot of the facilities I work on simply cannot do, given market comparisons (or simply what they want to charge their customers). So there's no right or wrong way for any of these pieces, but my position is that they all have to work together when they balance out.
What is the debt serice ratio projections at full maturity that you are seeing recent projects at?
It's tricky, because everyone comes to projects with wildly different situations. Some have cash, some don't. Some have a building they have access to, some can't find a space. Some are new businesses, some are existing and growing. Some can pay very high rent with higher returns, and other people can't make that work. All of those factors mean that it's all over the place, but if you have a lot of debt, you better have a very high-producing business model, which a lot of the facilities I work on simply cannot do, given market comparisons (or simply what they want to charge their customers). So there's no right or wrong way for any of these pieces, but my position is that they all have to work together when they balance out.