REITs can buy your building. So can we. Here's what's actually different.
The net lease REIT business and the Haven business share a fundamental structure: we buy commercial real estate and lease it back to the operators who use it. Both are triple-net. Both are long-term. Both price based on rent coverage and cap rate.
But the similarities stop there — and understanding the differences helps operators decide who the right buyer is for their specific situation.
This is not an argument that Haven is better than a REIT. There are deals where a REIT is exactly the right buyer, and I'll tell you which ones. There are deals where we are, and I'll tell you which ones of those too.
Scale and deal minimum
REITs operate at institutional scale. The largest net lease REITs — Realty Income, NNN REIT, STORE Capital's successor — manage portfolios in the tens of billions and underwrite hundreds of transactions per year. Their overhead structure, analyst teams, and institutional processes are built for deals above a certain size.
That size varies by REIT, but as a practical matter, most major net lease REITs are most interested in single-asset transactions above $5-7M and portfolio transactions above $20-30M. Below those thresholds, the economics of their transaction process — due diligence cost, legal, title, closing administration — make the deals less efficient for them.
Haven is built for the $2-10M range. Our process is scaled to make smaller transactions work well: same discipline, same diligence rigor, but a structure that doesn't require a $7M deal to cover the overhead of doing the transaction.
For operators with one or two locations in the $2-5M range, Haven is the buyer for your deal. A REIT will tell you they can do it — and they can — but they may not be the most motivated buyer for your deal size, which affects process responsiveness and pricing.
Decision speed and authority
REIT deal structures involve multiple approval layers. An acquisitions officer has buy authority within certain parameters, then escalates to investment committee, then to management approval for larger or off-parameter transactions. The timeline from signed term sheet to internal approval can run several weeks — then the external timeline (title, diligence, loan) adds more.
We close all-equity. There's no REIT investment committee and no acquisition financing process. Greg and the partners make the acquisition decision. When a term sheet is executed, the clock starts with a fully funded buyer.
That produces a real difference in close timelines. Our all-equity standard is 30-60 days from executed LOI to closing. A REIT using portfolio-level financing can take 90-120 days for a standard transaction.
For operators who have a time-sensitive capital need — an SBA maturity, a new location deposit coming due, a development schedule that requires capital by a specific date — the timeline difference is substantive, not cosmetic.
Relationship orientation
REITs are publicly traded companies. Their primary obligation is to shareholders, expressed through FFO per share, dividend coverage, and portfolio performance metrics. Tenant relationships matter insofar as they affect rent collection and portfolio performance — but the REIT's relationship with any individual operator is a small fraction of a large institutional portfolio.
This creates a specific dynamic: when something goes wrong in an operator's business — a difficult quarter, a location that's underperforming, a management transition — the REIT's response is primarily governed by the lease terms and the portfolio-level risk assessment. The human relationship with the operator is secondary to the institutional relationship with the asset.
We're structured differently. When we close a deal, the operator has Greg's personal phone number. Not an investor relations line. Not a property management escalation path. The partner who underwrote the deal and made the investment decision.
This matters in practice when things get complicated — and over a 20-year lease term, something always gets complicated. An operator who can call the person who made the investment and have a conversation about what's happening is in a different position than an operator who submits a formal notice of operational difficulty to an institutional asset manager.
I'm not saying REITs are bad partners. I'm saying the relationship structure is different because the business model is different. For operators who want institutional efficiency and don't particularly need a personal capital relationship, a REIT may be the right fit. For operators who are building something over a long period and want a capital partner with a stake in the relationship, not just the asset — that's where Haven fits.
Underwriting flexibility
REITs underwrite to institutional parameters — parameters set by investment committees, credit guidelines, and portfolio policy that balance consistency across hundreds of transactions against the nuance of any individual deal.
That consistency is an asset when an operator's situation fits cleanly into the parameters. It's a liability when the situation is non-standard: a franchise system the REIT hasn't worked with before, a market they haven't analyzed, a coverage ratio that's technically adequate but at the low end of the range, a property condition that needs explanation rather than checkbox compliance.
We look at non-standard situations as part of the job. If an operator has a genuinely explainable difficult year in their trailing history, we want to understand the explanation — not run it through a parameter filter that either accepts or rejects without nuance. If an operator is in a franchise system we haven't worked with, we'll learn the system. If the property is in a secondary market we haven't previously acquired in, we'll do the market work.
This doesn't mean we take more risk than REITs. It means we make decisions with more judgment than a parameter-constrained institutional process allows. Sometimes that judgment tells us to pass — and we pass on a lot of deals. Sometimes it tells us a non-standard situation is actually a strong credit, and we move forward on deals a REIT would reject at intake.
Where REITs are actually the better answer
I said at the top I'd tell you when a REIT is the right buyer. Here are those situations:
Large portfolio transactions. If you have $20M+ in real estate across ten or more locations, a REIT's institutional process, portfolio-level pricing advantage, and legal infrastructure make them well-suited for that transaction size. We can do smaller portfolio deals — three to five locations in the $5-10M range — but for institutional-scale portfolios, the REITs are built for it.
Publicly traded operators seeking rated counterparty. Some operators — particularly larger franchise systems, national retailers, or publicly traded companies — want the certainty and credit profile of a publicly traded REIT as their real estate counterparty. For those operators, the institutional structure of a REIT is the right fit.
Operators who want pure arm's-length transaction. If you want to close the deal and not hear from your buyer for 20 years, a REIT produces that outcome efficiently. The institutional process, the property management layer, and the portfolio-level relationship management create a structure where the landlord relationship is appropriately distant. Some operators want that. It's a legitimate preference.
The honest answer
Haven is the right buyer for middle-market operators — one to ten locations, $2-15M in real estate, who are building something and want a capital partner with judgment, speed, and a stake in the relationship, not just the asset.
REITs are the right buyer for operators at institutional scale, or operators whose preference is for institutional process and arm's-length relationship.
The question isn't which is better. It's which fits your deal and your operating model. Most operators who call us already know which category they're in — they just want to confirm that the option they're considering is the right one for their situation.
Want to talk through where Haven fits in your capital strategy vs. what you'd get from the institutional alternatives? That's a 15-minute call.