Commercial Mortgage Insider Blog

The commercial mortgage insider blog provides a glimpse into the world of small commercial mortgages. Keep up to date with the market and get tips and strategies you can implement for owner occupied and investment commercial properties.

Dec 01, 2015

Going the Extra Square Foot

When small businesses consider commercial financing to buy their own building, there are a lot of things to think about. Obviously, things like location, accessibility, building condition and space are important, but there are an increasing number of small business owners deciding to go the extra square foot. These owners are buying or constructing buildings that contain additional space to lease out to other tenants. As a result, they are not just building owners, but also investors as well.

This is a growing trend that we have experienced largely with those clients seeking office building financing or retail property loans. These borrowers have the foresight to finance and buy more space than they need in order to lease it out. Sometimes this can be as small as an additional 500 square foot up to over 1,000 square feet. In certain situations, building owners can make almost enough from their additional space to cover a substantial amount of their commercial mortgage.

In the retail sector, this trend has proven quite valuable. It is not uncommon to find a convenience store owner build additional space that can be used for smaller tenants such as store space for a cleaners or for a liquor store. Some have even gone so far to obtain strip shopping center construction loans in order to construct something a bit larger. These owners also have control in who co-tenants the building with them so they can build a synergy with their fellow tenants.

The same is true in the office sector when attorneys or accountants build or buy a larger building in order to lease out the additional space. This not only creates additional revenue but the opportunity to create synergy by leasing that spaces to businesses that compliment or enhances their own, such as a real estate company leasing out space to a title company.

When it comes to seeking office building financing or shopping center financing, creating an income stream with additional space can help in obtaining a commercial mortgage. It can create stronger confidence for the lender in the borrower’s ability to pay back the loan. It is most beneficial when a small businesses owner has a tenant or two already lined up for the additional space. A letter of intent from a potential tenant will further cement confidence in the loan for the lender. It may also enable the borrower to obtain more favorable terms due to the promised income stream that will be generated.

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Apr 24, 2014

Commercial Mortgage Market Growing Again

Many small and mid-sized businesses are expecting growth and improved profitability as 2014 continues. This optimism is fueling strong growth in the commercial mortgage arena.

There is a lot of liquidity on the balance sheets of many commercial lenders so commercial loan growth is set to continue.

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Apr 18, 2014

Loans to Solve Tax Problems

Many small business owners have tax problems that effectively shut them out from bank financing. There are loan programs available to solve tax issues, generating cash to clear tax liens or pay prior or current year taxes.

Tax liabilities are both common and devastating to business owners. Solving them quickly can save huge penalties and fees as well as preventing damage to personal credit.

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Apr 17, 2014

Best Commercial Mortgage Rates of 2014

Too many "lenders" and "brokers" mislead prospective borrowers with super low rate quotes and promises. Be careful when you hear about rates "as low as" or "starting at" because they are always worse than expected.

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May 24, 2010

Defaults on Apartment Loans Rising

Although defaults on Apartment Building loans are rising, K2 Commercial Finance has lenders ready to make apartment building loans.

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Sep 21, 2009

SBA Stimulus Package

Earlier this year, the Small Business Administration set aside $375 million to temporarily eliminate loan fees and increase the agency's loan guarantee to 90 percent for certain loans. The moves were part of the American Recovery and Reinvestment Act (ARRA), which was signed into law by President Obama in mid-February.

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Jun 18, 2009

7 Reasons to buy Owner Occupied Commercial Real Estate in 2009

This article offers 7 compelling reasons why the second half of 2009 offers a great opportunity for businesses to purchase property and stor paying rent.

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Jun 05, 2009

Commercial Mortgage, Hard Money Loans, SBA Loans, Stated Income Commercial Loans

Get Fast Commercial Mortgages on all property types. SBA Loans and Stated Income Loans are our specialty. NO Upfront Fees.

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May 21, 2009

Despite Economy, CRE Portfolios Performing Adequately for Banks

Recession is Driving Down Property Values, But Cash Flows Providing Cushion for Loan Values

For all of the dread concerning a widespread crash in the commercial real estate markets that has been put into words in the first quarter of 2009, the nation's largest banks seem relatively unruffled coming out of the quarter.

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May 20, 2009

Investors savor higher cap rates and a lack of competition.

In the midst of falling property values and stagnant investment sales, Macquarie DDR Trust put a portfolio of 52 shopping centers worth a book value of $1.9 billion on the market in April. The venture's decision immediately sparked heated discussion throughout the commercial real estate industry: Why put these assets on the market when valuations are so depressed? And perhaps more importantly, will they actually trade?

Continue reading "Investors savor higher cap rates and a lack of competition."

May 14, 2009

Commercial Loans Still Available

I am frustrated by the calls I get where business owners lament that there is no financing available to purchase commercial property. It's simply not true. In fact, my one man commercial mortgage brokerage has closed 3 transactions this month alone.

In reality the number of completed commercial loan transactions is down significantly from last year as is the dollar value of commercial loan closings.

The key point is that there are still lenders aggressively seeking loans. The sweet spot at the moment is owner occupied property where a business owner purchases or refinances the property from which they operate their business.

I can secure upwards of 90% financing for these properties using government backed loan programs. I know the process and which lenders are actively closing transactions in specific regions and for specific property types.

Commercial lending is down but lending for your specific project is likely still available...if you know where to look and how to navigate the waters of government backed (SBA-USDA-FHA) loan programs.

Call or email Ken Kaplan 215-230-1885 to discuss your loan scenario at no cost or obligation.

May 04, 2009

SBA has Eliminated Fees!

Thenks to the recently passed stimulus bill, all fees associated with SBA loans have been temporarily waived! That is a substantial savings for our borrowers. This measure is only going to last until the money allocated for the waived fees is used up, so give us a call and let us help you get your piece of the stimulus pie!

May 03, 2009

SBA Stimulus plans have lenders active again

Elimination of fees and increased SBA Guaranty has lenders increasing activity. But the real story is the entreprenuer. Quality deals have lenders excited about making loans.

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Apr 29, 2009

Commercial Real Estate Comeback

Harvey Green, of Marcus & Millichap Real Estate Investment Services, and Nicholas Schorsch, of American Realty Capital, discuss commercial real estate.

If you have an investment horizon of 3 to 5 years this market presents some great purchse opportunities. There are a lot of great properties with distressed sellers...financing is available and now may be a great time to act.

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Apr 25, 2009

Commercial real estate business may look different in the future

For the past two hundred years, fortunes have been made and lost in the commercial real estate business in the United States. Once again, as in previous real estate cycles, the markets will adjust and will turn around. Opportunities will abound and the new "Commercial Real Estate Business" will begin.

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Apr 24, 2009

List of Banks who Took TARP Funds

This is a list of banks who took TARP Funds, including the amount of money they took and plotting them on a Google map. Interesting. Glad my lenders are'nt amoung those listed!

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Apr 23, 2009

Commercial Real Estate – 7 Compelling Reasons Business Owners Should Buy Commerc

Article discusses why the second half of 2009 is a great time for business owners to consider purchasing commercial property from which to opwrate their business.

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Apr 23, 2009

Retail Space Availability Reaches All-Time High

The nation's retail market posted negative quarterly net absorption for the first time, along with the highest vacancy and availability rates, since CoStar Group began tracking retail trends in 2000, according to the Bethesda, MD-based company's first-quarter 2009 retail review and forecast.

As more space hits the market, rents are declining and property values are dropping. This creates opportunities for small business owners to purchase property from which to run their business at outstanding historical values.

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Apr 22, 2009

Lender’s Reporting Higher SBA Loan Volume

This is our third monthly survey. Positive trends in lending are clearly seen. The charts included inthis report appear to show that a “bottom” has been hit and a recovery may be just around the corner.It is safe to say that the SBA Stimulus “ARRA” is working! The second fiscal quarter shouldcontinue to build a strong bottom and, in turn, allow for strong loan growth in the second half of thisyear.

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Apr 22, 2009

2009 Real Estate Investment Outlook

Marcus & Millichap 2009 Real Estate Investment Outlook Excellent Analysis - check it out!

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