Thinking of Buying a Commercial Asset?
It’s not just a home loan with a bigger price tag. Here are 4 things you need to know first.
Structure Over Rate
In residential, the rate is king. In commercial, structure is everything. Lenders don’t just look at your income; they look at:
- The property type (Office vs. Industrial).
- The strength of the tenant.
- The remaining lease term (WALE).
Tip: A “cheap” rate is useless if the loan structure stifles your cash flow.
Mind the Deposit Gap
Commercial LVRs (Loan-to-Value Ratios) are tighter.
- Standard Assets: Usually require a 30% deposit.
- Specialized Assets: Think childcare or medical. You might need 40%+.
Strategy: We often help clients use residential equity to cover this, keeping your business cash for operations.
Don’t Forget the GST
Most commercial sales attract GST. On a $2M property, that’s an extra $200k needed at settlement. Even though you can often claim it back, you need the funds available on day one.
The Fix: Ask us about GST bridging finance to protect your capital.
Look Beyond the Big Banks
Major banks have a limited “appetite.” If your business doesn’t fit their box, they’ll say no. At FinSelect, we have access to:
- Non-bank lenders for flexible terms.
- Private funders for fast-moving opportunities.
Insight: A “No” from your bank is just a sign you’re in the wrong “box.”
Whether you’re moving your business into its own space or building an investment portfolio, we’ll handle the heavy lifting. Contact us to start the conversation!
