Commercial Property Loans

Commercial lending does not work like a home loan. The valuation is driven by the lease, not by comparable sales. The servicing test is interest cover, not a residential calculator. And the gap between what a major bank will do and what a specialist lender will do on the same building is routinely fifteen points of LVR and fifteen years of term. We place commercial deals across bank, second-tier, non-bank, private and short-term lenders — so the deal goes to the lender whose policy actually fits it.

7 lender categories on panel

Loans from $100k to $50m

Formal approval typically 3–6 weeks

Terms to 30 years with selected lenders

Which of these is you?

The three commercial borrowers below get assessed on completely different things. Most lenders will only tell you that after the valuation comes back.

Owner-occupier

Buying your own premises

You run the business and you are tired of paying someone else’s mortgage. The lender looks at whether your business can service the debt, not just what the building would rent for.

Trading history and business cashflow drive the decision
Often the strongest LVR of the three — you are the tenant
Frequently better structured through your SMSF, because business real property is the one asset class a fund can lease back to you

Investor

Buying a leased asset

You are buying the income. So is the lender — which means the tenant, the lease term and the review structure decide both your valuation and your maximum LVR.

Serviceability is tested as interest cover on the net rent
A short lease or a weak tenant reduces the valuation, not just the rate
Lease doc options can approve on the lease alone, without full financials

Developer or builder

Building or subdividing

Funding is sized against two separate tests and the lower one binds. Get the equity contribution wrong at the start and the project stalls at the worst possible moment.

Limited by a percentage of total development cost and a percentage of gross realisation
Presale cover is the difference between bank and non-bank pricing
Drawn in stages against a quantity surveyor’s reports

Deposit and LVR by asset type

Most brokers will not publish this. It is the first question every commercial buyer has, so here it is.

Asset type	Bank	Non-bank specialist	Typical deposit
Industrial & warehouse	65–70%	up to 75–80%	20–35%
Office	60–70%	up to 75%	25–40%
Retail — strata or neighbourhood	55–65%	up to 70–75%	30–40%
Medical & consulting suites	65–70%	up to 80%	20–35%
Specialised security childcare, service station, hotel, self-storage	45–60%	up to 65%	35–50%
SMSF commercial (LRBA)	limited appetite	70–75%	25–30% plus a cash buffer
Development & construction	60–65% of GRV	65–75% of GRV	20–40% of total cost

Indicative ranges only, as at August 2026. Every commercial application is individually credit-assessed and lender policy changes without notice. These figures are not an offer, a quote or a guarantee of approval.

Lender type moves these numbers more than asset type does. A major bank and a non-bank specialist looking at the identical warehouse can differ by ten to fifteen points of LVR and by fifteen years of term. That difference is the whole reason to take a commercial deal to a panel rather than to your own bank.

Terms. Major banks typically write commercial facilities over 5–15 years and review them every 12–36 months. A 30-year term is standard where the security is residential. Several non-bank commercial lenders now offer 25–30 year terms on commercial security itself, some without an annual review. Interest only is usually available to 5 years; under roughly $1 million most banks will insist on principal and interest.

Servicing. Most commercial lenders test an interest cover ratio rather than a residential-style servicing calculation. A minimum of 1.5× is the common standard. Lease doc products can go as low as 1.2–1.25×, low doc typically requires 2.0×, and specialised assets are often tested at 2.0–2.5×. Cover is assessed at a buffered rate, not at the rate you are quoted.

Pricing. For the same borrower and a standard asset, a bank commercial rate typically sits around 0.5–1.5 percentage points above that bank’s residential rate; non-bank and private pricing sits materially higher again. Commercial loans are priced deal by deal rather than off a rate card, which is why we do not publish a headline rate — a number that means nothing until your deal is assessed is worse than no number.

What we can fund

Our commercial panel is organised into seven categories. Most deals that get declined are not bad deals — they are deals taken to the wrong category.

Full DocFinancials and tax returns. Sharpest pricing and the longest list of acceptable securities.

Alt Doc & Lease DocApproved on an accountant’s declaration, or on the lease alone. Built for self-employed borrowers and clean rental income.

Second TierFor deals a major declines on policy rather than on merit — the security type, the trading history or the structure.

SMSF & SMELimited recourse borrowing for a self managed fund, and business real property so you can buy your own premises through the fund.

PrivateSpeed and flexibility on short terms, priced accordingly. Useful when a settlement date will not move.

Construction, Development & LandSized against cost and realisation, drawn progressively against quantity surveyor reports.

Short TermBridging, settlement shortfalls and working capital where the exit is clear and dated.

How it runs, and how long it takes

A bank commercial purchase is usually six to ten weeks from application to settlement. Private funding can be days. Here is where the time actually goes.

Scenario call30 minutes
What you are buying, what the entity earns and what you have. We tell you on the call whether it is fundable and roughly where.
Structure and lender shortlist2–5 days
Which lenders will take this asset, at what LVR, on what cover test, and what each will price it at.
Documents in one pass1–2 weeks
We give you the full list up front. Submitting documents piecemeal is the single biggest cause of a six-week deal becoming a twelve-week deal.
Credit assessment and valuation2–3 weeks
The valuation is the risk point. We flag lease and covenant issues before it is ordered, not after.
Formal approval to settlement2–4 weeks
Documents, legals and settlement. Development finance typically runs longer — allow eight to twelve weeks or more.

Where commercial deals come unstuck

Six things that cost buyers money, in rough order of how often we see them.

The valuation is income-based, not sales-based

Commercial value comes off the rent, the remaining lease term and the strength of the tenant — not from what the shop next door sold for. A short lease or a weak covenant reduces the valuation itself, and the shortfall comes out of your deposit, not the bank’s.

The going-concern trap

For pubs, motels and service stations the LVR is struck against the going-concern value — land, building and business together. The cash you actually need is materially more than the headline LVR gap suggests.

Interest cover is tested at a buffered rate

Passing at the rate you have been quoted is not the test. Lenders assess cover at a rate well above it, which is why deals that look comfortable on a spreadsheet get declined on servicing.

A bank facility is not a 30-year loan

Many bank commercial facilities run 5 to 15 years with a review every 12 to 36 months. If the review goes badly you refinance on someone else’s timetable. Plan for the review, not just the settlement.

Under about $1m, most banks want principal and interest

If you modelled the purchase on interest-only cashflow, check this before you exchange. It is a several-hundred-dollar-a-month difference discovered at the worst moment.

Documents submitted piecemeal

Every partial submission restarts a queue. It is the most common reason a straightforward deal takes twice as long as it should, and it is entirely avoidable.

Questions we get asked

How much deposit do I actually need?

For standard commercial — industrial, office, retail, medical — budget 20% to 40% depending on the asset and the lender. Specialised security such as childcare, service stations, pubs and self-storage typically needs 35% to 50%. The table above breaks it down. Remember that stamp duty and acquisition costs sit on top of the deposit and are not lent against.

Is a commercial loan regulated the same way as my home loan?

No. Credit provided wholly or predominantly for business purposes sits outside the National Consumer Credit Protection Act, so the responsible lending obligations that apply to your home loan do not apply to a genuine commercial facility. That is not a licence for anyone to be careless with your money — it just means the protections are different, and you should know which side of the line your loan sits on. If you are an individual borrowing for residential investment, that is regulated credit and we treat it that way. If you are a personal guarantor on a company loan, you may still have consumer protections. Ask us and we will tell you where your deal sits before you sign anything.

How are you paid?

Commercial lenders pay a commission on settlement. Some commercial, development and private transactions also carry a fee for service, because the work involved is not covered by lender commission alone. Whatever applies to your transaction is disclosed to you in writing, in dollars, before you proceed — not buried in a document at settlement.

Can my SMSF buy a commercial property?

Yes, through a limited recourse borrowing arrangement. Commercial is where SMSF borrowing is genuinely powerful, because business real property is the one asset class a fund is permitted to lease to a related party — so a business owner can hold their own premises inside their fund and pay rent to it at market rates. There are strict rules around structure, valuation and the arm’s length requirement. We work alongside your accountant and SMSF adviser on these; we do not give tax or superannuation advice. See our SMSF property investment page for more.

How long does it take?

For a bank commercial purchase, allow three to six weeks to formal approval and six to ten weeks from application to settlement. Non-bank specialists are usually faster. Private funding can settle in one to three weeks, and occasionally in days where the exit is clean. Development finance typically runs eight to twelve weeks or longer. The variable that moves the timeline most is not the lender — it is how completely the first submission is prepared.

What will you need from me?

For a full doc application: the contract of sale, the lease or lease schedule, the last two years of financials and tax returns for the borrowing entity and the guarantors, current ATO portals, an asset and liability position, and identification. For lease doc, often just the contract, the lease and identification. For development, add the feasibility, the builder’s contract or costings, the DA and any presale contracts. We send you the exact list for your lender before you start collecting anything.

Tell us the scenario. We will tell you if it is fundable.

Thirty minutes, no cost, no obligation. Bring the address, the lease if there is one, and a rough picture of the entity buying it. You will leave the call knowing the realistic LVR, the likely lender category and what it will take to get there.

Book a scenario call
+61 426 223 035

This page contains general information only. It is not credit assistance, not personal advice, not a quote and not an offer of finance. All rates, LVRs, terms and timeframes described are indicative as at August 2026, vary between lenders, and are subject to lender policy, valuation and full credit assessment. Your own position depends on your circumstances and the security offered. Commercial and business-purpose lending is not regulated by the National Consumer Credit Protection Act 2009. Superannuation, taxation and structuring questions should be directed to your accountant, SMSF adviser or tax agent. Related reading: investment property loans and SMSF property investment.