By Cleo Folkes
As House of Fraser announced the closure of 31 stores earlier this month and Debenhams issued their third profit warnings in the year today, we hear that landlords worry about covenant strength. What is it exactly that they worry about?
In property you often hear the word covenant strength when people talk about a tenant or the quality of an investment property or real estate loan. When you Google the definition for covenant it will tell you it is “an agreement” or something you “agree by lease, deed, or other legal contract”. Thus, when people talk about covenant strength, they are talking about how secure the income is coming from a lease with a tenant. Continue reading What is covenant strength and why does it matter?