Commercial Property Finance: Buying premises for your business or investment

Buying your business premises or buying for investment - we can help you find the Commercial Property Finance deal that's right for you

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Current Terms Available

Large scale borrowing

  • Terms up to 20 years
  • £50,000 – No Maximum
  • Rates from 2% over base rate
  • Individual arrangements tailored to your circumstances

Designed around your needs

  • Repayments geared to your turnover
  • Adverse Credit – no problem
  • No Income Proof Required
  • Repayment and interest only available

Versatile

  • Refinance existing property
  • Up to 80% Loan to Value available
  • Purchase land, premises or investment property
  • Commercial, Residential and Land

Talk to Rangewell – the business finance experts

The right property finance can be the key to a profitable business. We know every property lender in the market and use our contacts to help you find the deal that's right for you.

Commercial property can be more than simply necessity for your business, it can be a rewarding investment.

Buying the right commercial property can provide premises for your business, which can reduce your outgoings and create a valuable additional asset for your business.

It can also be a way of buying into the property market to that you can let out to generate an income, as well as capital growth.

As with residential property, location is of prime importance. You will also need to consider how the property will be used, and whether there are any restrictions on the uses it can be put to.

The usage classes for property are:

  • A1 shops
  • A2 financial and professional services
  • A3 restaurants and cafés
  • A4 drinking establishments
  • A5 takeaways
  • B1 business
  • B2 industrial
  • B8 storage or distribution
  • C1 hotels
  • C2 residential institutions
  • C2A secure residential institution
  • C3 homes
  • C4 houses in multiple occupation
  • D1 non-residential institutions
  • D2 assembly and leisure

If you intend to redevelop the building or alter its intended use, you may require planning permission.

Buying property with a Commercial Mortgage

A Commercial Mortgage is one of the most common forms of finance used to buy a commercial property. These operate much like a residential mortgage, with a large loan secured on the property itself.

Generally, Commercial Mortgages are for 15 years or more and, as with a residential mortgage, the premises will be at risk if you are unable to keep up your repayments

Unlike a residential mortgage, the rates for a Commercial Mortgage are arranged on an individual basis. Lenders will look at your business, your accounts and projections to ensure that it has a future and set interest rates based on the level of risk they believe it presents.

There will be valuation, arrangement and legal fees to consider. There can also be additional costs associated with a Commercial Mortgage for the services of professional advisors.

How much can you borrow?

Because of the legal and administrative costs, it is uneconomic to borrow less than £50,000 with a Commercial Mortgage, and some lenders have a minimum of £75,000 or more, but there is no set upper limit.

Typical loan-to-value ratios for a new business with no trading history will be a maximum of 50% of the purchase price. Owner-occupied businesses such as offices or shops can normally get a maximum loan-to-value of around 80%.

Commercial Mortgages can be used for three purposes:

Owner-occupied premises

Commercial Mortgages for owner-occupiers allow a company to purchase the premises where it operates to buy new premises to move into.

Residential buy to let

Commercial Mortgages can be used to fund the purchase of residential property to be let out. This approach is commonly used by professional landlords as well as buy to let limited companies to help build a property portfolio.

Commercial buy to let

Commercial Mortgages can also fund commercial buy to lets, so you could, for example, buy a warehouse and let it out to another business.

Repaying the mortgage

Commercial Mortgage deals are either fixed-rate or variable rate. Fixed rate deals are usually between two and five years. On the other hand, taking a variable rate mortgage will allow you to benefit from any reductions in the base rate, but will also mean repayments may increase if the base rate increases.

You may also be able to choose a repayment mortgage option where you pay the capital and interest back each month or an interest-only mortgage, where you only pay the interest back each month. If you choose this option, the lender will seek evidence of an appropriate investment policy that will cover the outstanding capital at the end of the loan term.

Other types of Commercial Property Finance

Although Commercial Mortgages are a popular form of funding for commercial property, several other solutions exist which can provide solutions for particular purposes.

Property Development Finance

Property Development Finance usually in the form of a short-term loan that can be used for the development of a new building project, or refurbishment of an existing property.

Lenders may advance up to 70% of the gross development value, and terms can be up to 24 months.

Find out more about Property Development Finance here

Bridging Finance

Bridging Finance is a short-term finance solution used by property developers and investors, which provides a quick way to finance the purchase of a property. The lender will take first charge on your property, and will seek an exit once the loan has come to term.

Find out more about Bridging Finance here

Auction Finance

Auction Finance is a way of arranging funding in advance of an auction. It can help you know how much you can bid on a particular property.

Find out more about Auction Finance here.

REAL EXAMPLES OF WHAT WE CAN DO

  • Help a first time landlord buy an old school for conversion into commercial units

  • Find the most competitive funding for a business wanting to buy its offices

  • Find finance for an industrial unit operator buy an adjacent site to expand

  • Source funding to allow a landlord to build his property portfolio

  • Arrange funding for a transport company to buy a regional depot

Commercial property solutions from Rangewell

Commercial property involves high costs, and it is important to have expert help to get the kind of funding that will help you reduce your outgoings.

At Rangewell, we have access to the full range of funding from lenders across the market.  It lets us use our property finance expertise to support your business – and ensure that you have the financial solutions you need.

ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

When the opportunity to buy our office premises came up, it was too good to miss - we pay less each month and we’ll own it outright.

You need to build a portfolio fast if you are serious about a property business. Rangewell help us find the solutions we need.

Using a commercial mortgage has let me buy the land next to my business park - I will be building new units on it.

Helping you build your profits

Buy a property for your business

Commercial mortgages can you buy your current business premises, or new premises to move into – and secure a valuable asset.

Buy an investment property

Commercial mortgages can help you purchase a property to be let out – helping professional landlords and buy-to-let companies to build up a property portfolio.

Buy at auction

Buying a commercial property at auction depends on having access to a large reserve of cash. Auction finance is designed to help.

Short-term and long-term funding

Many deals are based on short-term finance with a bridging loan to allow them to be progressed fast - and then refinanced with a commercial mortgage to reduce costs for the long-term.

Build a property portfolio

Commercial mortgages can be the simple way to build a property portfolio, for residential or commercial buy to let or for development.

Gain an appreciating asset for your business

Buying your own premises can be a valuable asset for your business which could offer the prospect of capital growth.

Download Rangewell’s free and detailed guide to Commercial Property Finance

  • What types of funding are available for commercial property?

  • How do commercial mortgages differ from a residential mortgages

  • How can refinance free up funds?

  • What are the costs?

  • What are the restrictions?

  • The downsides and how to avoid them

  • Paperwork you need to provide with your application

  • Key terms to check

Costs may be higher than you expect

Interest rates on Commercial Property Funding are set on an individual basis and may be higher than a residential mortgage. Legal and other costs may also be higher.

Rates are variable

Although you may be able to fix interest rates for an initial period, the rates will be variable over the longer term. This means that your monthly outgoings could increase in the future.

The risk of loss

Any property used as security, which may include your home, may be repossessed if you do not keep up repayments on your mortgage.

Our service is...

Impartial

Transparent and independent, treating all lenders equally, finding the best deals.

In-depth

Every type of finance for every type of business from the entire market - over 300 lenders.

In-person

Specialist Finance Experts support you every step of the way.

Free

We make no charge of any kind when we help you find the loan you need.