Tenant Credit Scorecard Calculator

Tenant quality drives lease value. This calculator scores credit from rating, financials, industry, and history.

Credit rating

EBITDAR / rent ratio

Industry stability (1-5)

Payment history (1-5)

Credit score (0-100)

Classification

Solid credit

Suggested security

2 months + 1 LC

How the math works

Score blends rating, coverage, industry, and history. 80+ = IG-grade value. 60-80 = solid mid-market. Under 60 = structure around risk.

Pricing models reward tenant credit with cap rate compression — an IG tenant can trade 50-100 bps tighter than a BB tenant on identical space. Document credit rigorously to capture the pricing spread.

How to Use

Select tenant credit rating.
Enter coverage ratio.
Rate industry stability (1-5).
Rate payment history (1-5).
Read credit score.

Frequently Asked Questions

Rating categories?

Investment grade (BBB-/Baa3 or higher) = strongest. Below investment grade but public = moderate. Private with financials = depends. Startups or undocumented = weak unless PG or LC.

Coverage ratio?

EBITDAR / rent coverage. 3.0x+ = strong. 2.0-3.0x = adequate. Under 2.0x = tight. Restaurant/retail often 1.5-2.5x; office/industrial 3-10x+.

Score application?

High-scoring tenants support lower cap rates (5-10 bps), easier financing, reduced reserves. Low-scoring tenants need LC, PG, higher security deposits, or shorter terms.

What documentation matters here?

Written leases, move-in/move-out inspections with photographs, ledger entries showing every payment and charge, served notices with proof of service, and contemporaneous emails or texts. Courts weigh written evidence heavily; informal understandings rarely stand. Institutional operators run a monthly file audit to catch gaps before they matter. Good paper trails recover most of what's owed.