Bank-issued security for the tenant's lease obligations.
Lease structure · US
Bank-issued security for the tenant's lease obligations.
A standby letter of credit is a common security mechanism in US institutional leases. Typical sizing: 6-12 months of base rent for a non-investment-grade tenant. The LOC reduces in step with the tenant's covenant maturing or via burn-down provisions.
Letter of credit (LOC) is part of the lease structure vocabulary that institutional Class A occupiers, landlords, and advisers use across US markets. Understanding it correctly affects how you read lease documents, model occupancy economics, and benchmark deal terms across cities. Class A Atlas tracks the US definition alongside the global standard so cross-border occupiers can translate quickly.