Commercial Property Finance & Security

Commercial property finance is a type of loan or funding provided to individuals or businesses for the purpose of purchasing or investing in commercial real estate. The duration of commercial property finance can vary depending on several factors: Short-Term Finance: Short-term financing options, such as bridge loans or commercial mortgages, typically have a duration of one to three years. These loans are often used for temporary funding needs, such as property acquisition, renovation, or refinancing before a more permanent financing solution is obtained. Medium-Term Finance: Medium-term financing options generally have a duration of three to ten years. These loans are commonly used for property development projects, commercial construction, or leasehold improvements. The repayment terms are typically structured to match the anticipated cash flows from the commercial property. Long-Term Finance: Long-term financing options, such as traditional commercial mortgages, can have durations ranging from ten to thirty years or more. These loans are suitable for the purchase or refinancing of stabilised income-producing commercial properties, such as office buildings, retail centres, or industrial warehouses. The repayment period is extended to allow borrowers to comfortably repay the loan over an extended period.

Refinancing a property as part of a corporate restructure typically involves the following steps: Evaluate the current financial situation: Assess the company’s financial position and the performance of the property to determine if refinancing is necessary or beneficial for the corporate restructure. Determine the goals and objectives: Define the objectives of the corporate restructure and how refinancing the property fits into the overall strategy. Identify the desired outcome, such as reducing interest rates, extending the loan term, or accessing equity. Gather necessary documentation: Prepare the required financial documents, including property appraisals, financial statements, tax returns, and any other information requested by potential lenders. These documents will be used to assess the property’s value and the company’s financial stability. Research and compare lenders: Research different lenders, including banks, credit unions, and alternative financing options, to find the most favourable terms and interest rates for the refinancing. Obtain multiple loan quotes and compare them to choose the best option. Submit loan applications: Complete the loan application process for the chosen lender. Provide all requested information accurately and promptly. Be prepared to answer any additional questions or provide additional documentation during the underwriting process. Review and negotiate loan terms: Once the loan offers are received, review the terms, including interest rates, repayment schedules, fees, and any restrictions or covenants. Negotiate with the lender to ensure the terms align with the company’s objectives and financial capabilities. Close the loan: Finalise the loan agreement, sign the necessary documents, and satisfy any closing conditions required by the lender. This may involve paying off the existing loan and establishing the new loan terms. Implement the corporate restructure: Use the funds obtained through refinancing to support the intended corporate restructure, such as paying off debts, investing in new projects, or improving cash flow.