Our company provides debt-free lease financing, allowing governments to use their capital resources on other vital public needs while providing world-class facilities for core services
CoreCivic agreements are specifically structured to be short-term, debt-free leases. The lease itself has the following terms:
- It is a short-term lease with renewal options exercisable by mutual consent. The government partner is not locked into a long-term lease if demand or needs change.
- The lease has termination for convenience clauses to allow the government partner maximum flexibility if its needs change.
- There is no payment due to CoreCivic at termination except for services already delivered under the lease.
- The lease contains "subject to appropriation language" that allows the government partner to exit the lease at any time if funds are allocated.
- The lease rate is set from the beginning with stated inflators for out years in the event that the lease is continued.
As this is a true lease, ownership does not revert to the government partner after the lease term, and the asset remains owned by CoreCivic.
Debt-Free Lease Financing and Payments
For more than 30 years, we have offered debt-free lease financing, which allows our government partners to use their capital resources on other vital public needs while also providing world-class facilities for core services. We currently have more than 50 company-owned assets that have leases structured in the manner described above. This time-tested model pioneered the CoreCivic model. With CoreCivic, we allow our government partners to administer the day-to-day operations of the facilities we build and maintain. In this respect, these leases are no different than a government partner leasing an office building or other real estate asset for its use.
CoreCivic finances its projects using our strong balance sheet, which has its own investment grade credit rating by Moody's and more than $1 billion in available capital. That means government partners have no financing obligation. Furthermore, financing is not project-specific, does not require the government partner to lend its credit rating to the project, and is based solely on our ability to deploy capital.
Payments to CoreCivic begin only when construction is complete and the government partner begins using the facility. There are no "milestone" type payments required during construction, and CoreCivic remains solely liable for the project during this phase.
To learn more about CoreCivic's lease-based services, or to acquire information of available inventory, please contact our team today.