Seller Rollover Distributions - Market Standards
I am trying to nail down the exact terms for seller rollover distributions and could use some advice on market standard.
My questions for the group:
- Are you calculating rollover distributions before or after debt service? After debt service involves the capital structure and would get push back by the seller?
- What exact terms and waterfall mechanics are you using to satisfy the bank (minimum DSCR or liquidity) while keeping the rollover attractive to the seller?
- How do you successfully communicate the "non-mandatory and subject to minimums" reality to the seller without killing the deal?
Thanks in advance for any insights!