A large proportion of the covenants and restrictions contained in loans to finance ADC of commercial properties are directed at the:

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The covenants and restrictions contained in loans to finance ADC of commercial properties are primarily directed at developers to ensure that they adhere to the terms and conditions of the loan and manage the project properly. This is because there is a high degree of agency problems in such financing, and the lender wants to minimize the risks associated with the project. Therefore, the developer has to meet certain performance criteria, such as completing the construction on time, generating sufficient cash flows, maintaining adequate insurance, and complying with zoning and other regulations. Additionally, the lender may place restrictions on the developer's ability to sell or transfer the property, sublease space, or change the project's scope or use without prior approval.

A Large Proportion of the Covenants and Restrictions Contained in Loans