Extract to table

Lender consent for these transactions must be obtained from the master servicer or special servicer and may require rating agency confirmation, making the consent process time-consuming and uncertain

REIT Distribution Requirements Fairwater's status as a REIT under Sections 856–860 of the Internal Revenue Code imposes a fundamental constraint on the Company's capital allocation: Fairwater must distribute at least 90% of its taxable income to its shareholders annually in order to maintain its REIT status and avoid entity-level federal income taxation

(c) SPE distribution restrictions must accommodate REIT requirements

These restrictions must be carefully negotiated to include appropriate carve-outs permitting distributions necessary to enable the Company to satisfy its REIT distribution obligations

This is a standard negotiation point in CMBS transactions involving REIT borrowers and is routinely resolved, but the drafting of the carve-out must be precise to avoid inadvertent limitations on the Company's ability to make required distributions