Commercial Mortgages

A commercial mortgage is a loan secured by commercial property such as an office building, shopping centre, industrial warehouse, or apartment complex. Unlike residential mortgages, which are taken out by individuals, commercial mortgages are often obtained by businesses or investors. These loans are typically used to purchase, refinance, or develop commercial property and they come with terms and conditions tailored to the needs of businesses and the risks associated with commercial properties.

1. Property Ownership

One of the most significant advantages of a commercial mortgage is that it enables your business to own property rather than rent. Ownership can provide stability, eliminate rental inflation concerns, and offer potential tax benefits. Property ownership also allows you to customise your space to meet your business’s specific needs.

2. Building Equity

As you make mortgage payments, you build equity in the property. This equity can be a valuable asset for your business, providing financial leverage for future investments or expansion. Equity can also be used as collateral for additional financing needs. Please remember that the level of equity seen at any one time, depends on the value of the property and the level of borrowing that is lent against the property. As such the level of equity can fluctuate over time and may fall, as well as rise.

3. Potential for Appreciation

Commercial property can potentially appreciate over time, increasing the value of your investment. The capital appreciation (of the property) can significantly enhance your business’s balance sheet and provide an upside if you decide to sell the property in the future. The converse is also true, in that the property’s value will fluctuate in line with market dynamics.

4. Tax Advantages

Owning commercial property can potentially offer several tax advantages but you should you speak to an expert tax adviser about these.

5. Rental Income Opportunities

If your business does not occupy the entire property, you can lease out unused space to other tenants. This rental income can help offset mortgage payments and other property-related expenses, providing an additional revenue stream for your business.

We can also provide Commercial Investment Mortgages, where the property being purchased is to be rented out to 3^rd parties.

6. Improved Cash Flow Management

We offer both fixed and variable rate Commercial Mortgages. With a fixed-rate mortgage, your business can benefit from predictable monthly payments, aiding in more accurate financial planning and cash flow management. This predictability is often more advantageous than dealing with fluctuating borrowing costs.

With a commercial mortgage from Assetz Capital you can borrow up to £10 million but we can arrange a facility of up to £50 million.

We will accept a maximum LTV of 70% with a commercial mortgage.

First legal charge (plus debenture and a level of personal guarantee for corporate borrowers).

We will lend for a number of different purposes including  purchase, refinance, equity release & general working capital. Build to term facilities are also available to provide a development facility that converts to a term loan typically upon practical completion.

We will accept owner occupied, fully let or part-let commercial & mixed use property.

Limited companies & LLPs can apply for a commercial mortgage with Assetz Capital.

Commercial mortgage repayment terms are capital & interest repayment with amortisation up to 25 years, initial interest only periods & interest only for full term considered within a 5 year term commitment. The minimum term is negotiable.

Our process explained PDF will take you through each step of our commercial mortgage process and show you just how straightforward it is.