What does CTL mean in real estate?

What is CTL in Real Estate?

In commercial real estate, CTL stands for Credit Tenant Lease. This type of lease involves properties that are leased to tenants with strong credit ratings, typically investment-grade ratings by credit agencies. In a CTL transaction, the financial strength and creditworthiness of the tenant are paramount because the lease payments are often used to secure mortgage debt for the property. These leases are generally long-term, with the tenant assuming many of the responsibilities typically held by the property owner, such as maintenance, taxes, and insurance. CTLs are attractive to investors because of the predictable income stream and lower risk profile associated with high-credit tenants.