Remodeling Your Business With Commercial Real Estate Financing

Commercial Real Estate

For many businesses, atmosphere is everything. If you’re not sure that your business has the right atmosphere as it currently is, you may be thinking of remodeling it in a major way. The challenge in such situations is usually not figuring out how to improve it – after all, you’re a business owner, so you’re used to having your creative thinking cap on. It’s the financing part that demands a bit more effort. Fortunately, there are numerous ways to get your plans into action with commercial real estate financing.

SBA 504 Loans

One of these financing options is a SBA 504 loan. If your business is pulling in less than a certain amount of money per year, you might qualify for this type of loan. The SBA 504 financing program was instantiated with the purpose of helping small businesses get the real estate assets they need to thrive and create more jobs. Loans of this type are meant to be used for anything related to commercial real estate financing, including buying buildings and other properties or renovating real estate assets that you already own. You can also use the funds to purchase large-scale equipment for your business. Nearly all types of for-profit businesses are welcome to apply. Non-profit organizations, including churches, will not qualify for an SBA 504 loan.

CBMS loans

CBMS stands for “commercial mortgage backed securities” – are a pretty solid option for people seeking to boost their businesses with a major renovation. You can receive large sums of money at fairly low interest rates with this type of loan, since the commercial lenders will be able to transform it into a reasonably low-risk investment that investors will purchase as bonds. The investment risk is reduced through the process of pooling numerous loans together in a single trust, and subdividing this trust to produce bonds that can be sold. Since each bond is a product of numerous individual investments, its risk is kept to a minimum and it will be more attractive to investors.

Mezzanine Financing

Mezzanine financing is another good way to finance your major renovation projects. If you’ve heard this described as a sort of second mortgage, you may be under the impression that it’s fairly risky. However, you actually don’t need to worry about your ability to retain ownership of a project, since that is guaranteed. It is this aspect of mezzanine financing that makes it so popular with business owners – if things fall apart, they still own the property.

Talk to one of our consultants today to learn more about the commercial real estate financing options for your business. The financing world is complex, but you will be able to come across a plan that will make your projects go as smoothly as possible.