Choosing the Right Commercial Real Estate Financing Plan

With so many commercial real estate financing options available, how do you know which one is right for your project? There are many factors to consider as you weigh options. Start by answering these questions:   

Where is the property located?  

Location plays a significant role in what types of commercial real estate financing are available. More options are available to properties located in larger national markets, while locations outside the U.S. are limited.  

Who currently occupies the property?  

Different commercial real estate financing types are available depending on whether you are looking to acquire a new property or refinance a property you already own. There are also additional considerations if you currently own the property but are leasing it to another business or if construction is involved. 

How is the property being used? 

Some loan types are reserved for specific properties, such as hospitals and multi-family rentals. Whether the business occupying the property is operating as a franchise is another contributing factor in commercial real estate financing opportunities available.  

How long do you plan to occupy the property?  

Commercial real estate financing terms come with different payback periods, averaging around ten years. Knowing whether you expect the business to outgrow the property or relocate at a certain point can help in evaluating your options.  

What are your growth projections? 

Your business plan or operating budget are essential documents to reference as you consider different commercial real estate financing terms. Knowing what your business can afford now and how your business is projected to grow in the future will help you in determining what payback options work best for your project.  

Insider tip: Make sure your business plan and budget documents are in excellent shape because your potential lender will use these to determine your loan’s risk factors. Consider seeking professional guidance if you need help sprucing up your business plan.  

How much do you need?  

Some loans start at $5M, while others can be secured for under $500k. If you need a lower amount, you may find that a small business loan, franchise financing, or another program is a better fit.  

Understanding The Different Commercial Real Estate Financing Programs  

Commercial Real Estate financing programs are diverse and plentiful. With so many options available, it can be overwhelming to know what programs meet your specific commercial real estate financing project. Barrington Commercial Capital can help you discover the program that best fits your needs. Learn more about the Commercial Real Estate Financing options available to your property type.   

Conventional Commercial Real Estate Financing Programs 

If you are looking to refinance or acquire new property in a major market, a conventional loan may be a good option. Conventional loans range from $200K to over $100M with rates as low as 3.75 percent. Terms generally go out to ten years with thirty-year amortizations. Properties eligible for a conventional commercial real estate loan include:  

  • Multi-Family  
  • Office 
  • Hotel  
  • Mobile Home Park  
  • Self-Storage  
  • Retail Commercial  

SBA 7a, 504, and CMBS Commercial Real Estate Financing Programs 

SBA 7a and 504 loans provide a longer loan period than a conventional loan, up to 25 years, at rates as low as 4.5% with fixed terms. These loans are available to:  

  • Owner-occupied Properties  
  • Flagged and Non-Flagged Hotels 

We can help you secure a CMBS loan through our partnerships with Wall Street firms. CMBS loans start at $1M with low-interest rates and non-recourse debt. These fixed terms are available for up to 10 years with 30-year amortizations and cash-out options. CMBS commercial real estate financing programs are available to the following property types:  

  • Multi-Family 
  • Office 
  • Retail 
  • Franchised Hotels 
  • Anchored and Unanchored Shopping Centers  
  • Credit Single Tenant Properties 

Equity and Mezzanine Financing 

As an alternative capital solutions provider, Barrington Commercial Capital represents high-net investors that can provide funding for projects starting at $5M. Mezzanine financing is a hybrid solution allowing the lender to convert debt into equity if the loan defaults.  

HUD and FHA  

Loans offered through the United States Department of Housing and Urban Development (HUD) and the Federal Housing Administration (FHA) provide excellent terms for qualifying properties. Both programs offer low fixed rates for commercial property acquisition, refinancing, new construction, and major rehabilitation projects starting at $2M. Additional benefits include credit enhancements, fully amortized loans with non-recourse and integrated construction, and permanent financing. Qualifying properties must be:  

  • Multi-Family Rentals 
  • Senior Housing 
  • Special Care Facilities 
  • Hospitals 

Construction Financing 

We provide attractive construction financing for loans between $10M and $100M to sponsors with equity in their projects.  

International Commercial Real Estate Financing 

Barrington Commercial Capital offers loans up to $1B for projects in foreign markets, including Europe and Eurasia. Loan types most commonly include debt, equity, and mezzanine programs.  

If you didn’t find the right loan type after reviewing the different commercial real estate financing options, we can help. We offer a complimentary consultation to help you discover the resources available for your commercial real estate project.  Request your complimentary, no-obligation consultation to learn more about our products that support small businesses. 

If you still have further questions about what financing option would be best for your future goals, please contact us by filling out the form below, or give us a call at 404-602-9100. To stay up to speed on all things Barrington Commercial Capital, follow us on FacebookTwitter, and LinkedIn. And lastly, sign-up for our monthly email to stay informed of the latest commercial capital options available to you and your business. 

Contact Us

Learn more about our many commercial real estate programs by contacting our finance team today.