Prepayment Penalties

What Is Defeasance?

What Is Defeasance?

Defeasance is a strategy that permits repayment of a commercial property loan on a property, to facilitate sale or refinance.

Power Centers in Commercial Real Estate

Power Centers in Commercial Real Estate

A power center is an outdoor shopping center with multiple big-box retailers, as well as an array of smaller retailers, restaurants, and other kinds of businesses. Power centers are typically located in suburban areas due to cost and space restrictions, but can sometimes be located in urban areas as well. Many power centers are set up as large strip centers, but also may contain several out-parcels, pieces of land intended for individual tenants, such as banks or fast-food chains. 

Prepayment Penalties in Commercial Real Estate

Prepayment Penalties in Commercial Real Estate

In commercial real estate loans, a prepayment penalty is a fee charged to borrower if they attempt to repay their loan early. When a lender issues a loan, they typically want to lock in their profit for a certain amount of time, so the prepayment penalty is a way to compensate them for their financial loss if the loan is paid off early.