Business finance
Commercial Property loans
Commercial property loans are used to finance the purchase or development of business premises as well as financing commercial or residential property projects and developments.
Loan size
$50K To $50M
loan term
1 to 25 years
Interest rate
4% to 12%
Approval speed
Slow
Commercial property loan
Key features of a commercial property loan
Commercial property loans differ from residential property loans in that the loan terms and pricing are unlikely to be standardised but depend on the characteristics of the development. A broker experienced in commercial property finance loans can help you negotiate better terms for financing your project.
Compare a commercial property loan
Advantages and disadvantages
Businesses that operate in industries that experience highly seasonal revenues find a line of credit especially useful to balance cash flows.
Advantages
What are the advantages of a commercial property loan
- Lower interest rates
- Long loan term
Disadvantages
What are the disadvantages of a commercial property loan
- Lengthy and time consuming approval process
- Non-payment could result in loss of property
Common uses & good to know
Everything else about a commercial property loan
Common uses
Property finance is accessed by businesses ranging from developers and builders building everything from small scale residential properties to huge commercial developments or factories. Commercial property finance is also applicable for businesses looking to purchase office or retail space.
As commercial property loans are secured against property assets, these loans tend to be less expensive than unsecured loans.
There is a wide array of lenders who are keen to lend against property collateral.
Good to know
On the other hand, the loan process may be time consuming and property development loans may have caveats and specific timing requirements that need to be fulfilled.
Pricing will depend on a number of factors including the purpose of the property. Standard commercial properties such as unit blocks, warehouses or office buildings command better pricing than more specialized properties such as schools, vineyards or supermarkets.
Alternative Commercial Lending options
Other Business Finance Products
Secured Business Loan
A secured business loan is a loan made by a bank or finance company where the lender requires the borrower to pledge assets as collateral against the loan.
Unsecured business loan
Unsecured business loans are loans made without requiring business collateral such as property or inventory.
Trade finance
Trade finance is any form of finance that is issued to support international trade, including letters of credit, debtor finance, & export credit.
Using Debtor Finance to Manage Business Cash Flows
Any business owner knows the importance of managing cash flows to ensure that liquidity remains strong and that the business has the ability to take advantage of sudden growth opportunities or big contracts Late payments impact businesses severely as cash that could otherwise be reinvested in growing stock marketing or
Commercial Property loan FAQ
Frequently asked questions
Similarly to a secured business loan, lenders will firstly look at the quality of your collateral in terms of the property or development and its value.
Lenders will also look at your current and historical financials and operating history as well as your credit history.
Several years of operating history as well as proof that current or projected cash flows will easily cover your interest expense will result in better loan pricing.
