Buying Commercial Real Estate
Commercial real estate is now coveted by more buyers than perhaps at any time in history. Thousands of people are pulling money out of the stock market and seeking a tangible investment with a positive return. As a result, investment property prices have soared and returns have dropped one to two percent lower than they were seeing even a couple years ago.
At the same time many business owners have discovered that today’s low rates make buying less expensive than leasing. Developers can hardly put up buildings fast enough to meet the demand of eager business owners with SBA prequalification letters in hand.
If you want to buy commercial real estate, you are entering a competitive arena. Most sellers receive multiple offers. Getting your financing plan in order will certainly give you an edge over the competition.
Simply put, most commercial property loans fall into one of two categories: owner occupied loans and income property loans. The processing and terms available for these two types is quite different. You should determine what type of loan you desire before proceeding.
Two Kinds of Commercial Real Estate Loans
Owner Occupied Loans
If you buy a property for your business to occupy, you will probably want an owner occupied loan. Click on this link for more information on these loans. Owner Occupied Loans.
Income Property Loans
If you are buying a building and you do not own any of the tenant businesses, you need an income property loan. Click on this link for more information on these loans. Income Property Loans.
Construction Loans
As an alternative to buying an existing building, you might also consider constructing a new building for yourself. See our discussion on construction loans.
