Commercial property loans differ from residential ones and may have higher interest rates or shorter terms. Interest rates on commercial property loans can vary based on market conditions, property type, and borrower creditworthiness. Commercial properties often require a higher down payment (typically 20–30%).

Legal Considerations

Commercial leases are more complex and negotiable than residential leases. We can help you find a solicitor to ensure the lease agreements are favourable. Be aware of tax considerations too, including income tax on rental earnings, capital gains tax, and VAT on commercial properties. Commercial properties often require more comprehensive insurance than residential properties (e.g., public liability, building insurance, and coverage for specific tenant activities).

Management and Maintenance

Decide if you will manage the property yourself or work with a professional property manager. Managing commercial properties can be demanding, however we have access to professional contractors who will help Older properties or specialised properties (e.g., warehouses, manufacturing spaces) may have higher maintenance costs.

Market Risks and Economic Factors

Commercial properties can take longer to lease if they become vacant, especially if the market is slow. Investigate competing properties and their vacancy rates in the area to understand market saturation.

Exit Strategy

Consider the potential for future resale. A property that is appealing to multiple industries or uses may be easier to sell if you need to exit. Properties in sought-after areas or with flexible configurations are typically easier to sell if the market changes.