We say no more often than we say yes. Here's why that's good for operators who actually fit.
We've walked away from more deals than most people think a capital partner in this market should walk away from.
That's deliberate. Every deal we do becomes a 20-year relationship with an operator. The selectivity isn't a posture — it's math. A deal we do at 1.4x rent coverage looks fine on paper in year one. In year five, when the operator hits a rough quarter and the coverage drops to 1.2x, it looks like a problem for everyone: the operator is under pressure, we're underwriting the risk of a lease modification, and the relationship that was supposed to run 20 years is strained at year five.
We'd rather walk from that deal at the LOI stage than spend two decades managing the consequences.
Here's what makes us walk, and why that matters if you're considering calling us.
We walk when the coverage math doesn't close
This one isn't negotiable. Rent coverage — the ratio of the business's unit-level EBITDA to the proposed annual rent — is the foundation of everything. Our floor is 2x for most business categories. QSR and restaurant operations have thinner margins by nature, so we start at 1.5x there. Industrial and distribution assets with mission-critical locations and limited fungibility can get to 3x or better, which is what we want to see in those categories.
Below floor with no path to enhancement: we walk.
The enhancement options are limited: corporate guarantee layered onto an operating entity guarantee, a letter of credit from the operator, additional collateral from unencumbered assets. These can adjust the risk profile of a deal that's otherwise below floor. What they can't do is substitute for a business that genuinely can't sustain the rent.
An operator who calls us with 1.3x coverage and asks if there's flexibility is having the wrong conversation. The question isn't whether we'll flex — it's whether their business can carry this rent for 20 years. If the answer is no, the right outcome is for them to wait until the unit economics are better, not to find a capital partner willing to structure a deal that creates financial pressure on their business.
We walk when the trend is wrong
The static coverage number tells us what the business looks like today. The trend tells us what it's likely to look like in year four.
A business at 2.3x coverage today that ran 3.1x three years ago is a fundamentally different credit story than a business at 2.3x coverage today that ran 2.0x three years ago. Same ratio, completely different trajectory.
We want the trend. Three years of unit-level P&L, ideally with monthly detail. If the trend is improving or stable, we can understand a bad year as an outlier. If the trend is declining, we can see whether it's structural or cyclical.
Structural decline is the walk. A business model that's losing ground — category pressure, competitive incursion, a franchise system in contraction — is a business we don't want to own the real estate for. The real estate and the business are linked. A declining tenant in a 20-year NNN lease is a real estate risk, not just a credit risk.
We walk when the concentration doesn't match the story
Portfolio operators are our most common caller — multi-unit operators who own 4, 7, 12 locations and want to unlock the equity across some or all of them.
The aggregate numbers often look clean. The unit-level detail sometimes doesn't.
We've seen a seven-store portfolio with strong aggregate coverage, 2.4x on the consolidated P&L. Looked good until we got into the individual locations: one flagship generating 55% of the EBITDA, four stores running 1.4-1.6x on their own, and two locations that were investment-period operations losing money. The aggregate is a weighted average that masks what's actually happening.
We structure deals by location, not by portfolio. Each property in a sale-leaseback carries its own rent obligation. A store running 1.4x coverage doesn't become viable because the portfolio averages 2.4x. If that store hits a difficult quarter, the rent obligation doesn't care about the flagship's performance.
We'll tell operators this in week one. Sometimes there's a path: exclude the weaker locations from the SLB, do a smaller transaction with the properties that meet the coverage threshold, and revisit when the other locations are performing better. Sometimes there isn't. Either way, the answer comes early.
We walk when the operator doesn't know their own numbers
This one is harder to articulate but easy to see in the conversation.
An operator who can answer "What happened in Q3 when EBITDA was down 18%?" with a clear explanation — a remodel period, a labor event, a one-time equipment failure — is telling us something important: they understand their business well enough to run it for 20 more years.
An operator who responds with "I'd have to check with my accountant" to questions about their own unit economics is telling us something different. Not that they're hiding anything. But a tenant who doesn't know their own P&L is a tenant we'd spend the next 20 years worrying about, not the next 20 years partnered with.
We've passed on deals with good coverage ratios and clean real estate because the operator's knowledge of their own business made us uncertain about the durability of those numbers. That's a judgment call that happens in the first two conversations.
What the walk-away rate means for you
If you know Haven says no to a lot of deals, you might wonder why you should bother calling.
Here's the honest answer: because a yes from us means something. We've done the diligence, we've looked at the coverage from every angle, and we've decided this is a relationship we want for 20 years. Operators who close with us know that — and so do the advisors who refer their clients to us.
A sale-leaseback from a selective capital partner is not the same as a sale-leaseback from a buyer who'll do any deal that shows positive coverage. The quality of your counterparty matters for 20 years. You're not just selling a building. You're choosing who owns the building your business depends on.
If your situation fits Haven's criteria, the conversation moves fast. We don't manufacture complexity. If it doesn't fit, we'll tell you that in the first call and explain what would need to change.
Think your deal might fit? The shortest path to finding out is a 15-minute call where we look at the coverage math together. If it works, we move. If it doesn't, you'll know exactly why.