Property Finance for Business Owners, Investors and Developers
Buying your own business premises, investing in commercial property or funding a development: we arrange property finance that fits the project, the property and your plans.
Funding Commercial and Semi-Commercial Property
A commercial mortgage is a long-term loan secured against business property, typically over terms of 5 to 25 years. We arrange commercial mortgages for two main types of borrower.
Owner-occupiers are businesses buying the premises they trade from, such as offices, surgeries, workshops, warehouses, shops or restaurants. Owning your premises can provide security, control over your space and, over time, a valuable business asset. Lenders mainly assess the strength and profitability of your business.
Investors are buying commercial property to let to business tenants. Here, lenders focus on the rental income, the quality and length of the leases, and the strength of the tenants.
We also arrange finance for semi-commercial property, such as a shop with a flat above, and for multi-unit freehold blocks, which sit between residential and commercial lending and often benefit from specialist lenders.
Typical loan to value limits range from around 60% to 75%, depending on the property, the sector and the borrower.
Funding for Ground-Up Builds and Conversions
Development finance funds the construction or conversion of property, from a single new house to a multi-unit scheme. It is usually released in stages as the build progresses, with each drawdown confirmed by an independent monitoring surveyor.
Lenders assess both the project and the people behind it. They will want to see:
- A detailed development appraisal showing costs, timescales and expected sale values (gross development value)
- Planning permission and building regulation approvals
- Your experience, or that of your professional team
- A realistic contingency and a clear exit, usually sale or refinance
Lenders typically fund a percentage of the build costs and land value, with gearing often measured against total costs and gross development value. Mezzanine and equity funding can sometimes reduce the amount of your own cash needed.
Adding Value to Existing Property
Refurbishment finance supports projects that improve an existing property, from light cosmetic work to heavy refurbishment involving structural changes or a change of use, such as converting an office into flats or a house into a house in multiple occupation.
Light refurbishment is often funded with bridging finance, while heavier projects can be funded on a similar staged basis to development finance. Once the work is complete, many investors refinance onto a longer-term mortgage based on the improved value.
Planning both stages together from the outset is important. The short-term lender will want to see that a long-term mortgage will be available once the work is finished, and the long-term lender may have its own requirements on timing, valuation and the type of property it will accept. We help you line up both, so the refurbishment loan leads straight into sustainable long-term finance rather than an expensive extension. For investors who refurbish regularly, we can also look at facilities designed for repeat projects, which can reduce costs and speed up each new purchase.
Projects That Stand Up to Scrutiny
Property and development lenders scrutinise the numbers closely. A clear appraisal, credible cost plan and well-presented business accounts make a significant difference to both approval and terms.
As the sister company of Futurewise Accountancy, we are comfortable with appraisals, cash flow forecasts and company accounts. We help you present a well-supported case to lenders, and with your permission we can coordinate with your accountant on structure and the supporting figures lenders request. For owner-occupiers, we can also advise on whether buying your premises through your trading company, a separate property company or a pension scheme might suit your plans, working alongside your accountant and pension adviser.
Frequently Asked Questions
How much deposit do I need for a commercial mortgage?
Typically 25% to 40% of the purchase price, depending on the property type and lender.
Can a first-time developer get development finance?
Yes, although lenders may lend less, or want an experienced contractor and professional team in place.
Are commercial mortgages regulated?
Most commercial mortgages and development finance are not regulated by the FCA.
Explore more of what we offer
Limited Company Buy to Let
Bridging Loans
Asset Finance
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