When people think about buying commercial real estate (or securing commercial real estate loans), there’s often a sense of intimidation — visions of multi-million-dollar price tags and complicated commercial loan processes loom large. The truth is, it’s neither that expensive nor that complicated (or at least, it doesn’t have to be).
If you’re looking to enter the commercial real estate game (either as a business owner looking for your perfect space or as a real estate investor), industrial micro-flex spaces are the best way to start. Lower entry point, easier financing, less hassles… we could go on and on. That said, even if you’re sold on a micro-flex space, you still probably have questions about securing a commercial loan.
Let’s dive into what makes financing one of these versatile spaces easier than expected — and why it might be the right move for you.
Commercial Real Estate Loans Easier Than a Home Loan? Absolutely
People are familiar with residential loans. It can be a real pain, but most folks know what they’re getting into. When it comes to commercial loans, though, it can be a big black box… who knows what’s inside?
The truth is, though, commercial loans are often easier to secure than a mortgage (sounds crazy, I know, but stay with me).
For starters, you’re not dealing with all the red tape that often comes with a residential loan. In fact, many banks — especially local community banks — offer streamlined processes that are designed to get you through the door faster and with less hassle.
You’ll need some basic paperwork to get started (like a personal financial statement and a couple of years of tax returns)… but that’s about it. If you’re self-employed or using the space for a new business, the process is even more flexible. A personal guarantee is often enough to secure the loan without the need for extensive background checks or invasive scrutiny.
Unlike home loans, where a loan officer combs through every single detail of your financial life, community banks focus more on your future potential and cash flow (especially when you’re putting the space to a productive business use).
I don’t know about you, but when I applied for my current mortgage, the loan officer was questioning any Venmo transaction >$500… Are you really trying to go through all that hassle as an investor if you don’t have to?
Some Actual Numbers On Commercial Real Estate Loans
While home loans do typically have lower interest rates, the benefits of a commercial loan are hard to overlook. You’re looking at long-term flexibility, which can ultimately make your investment more manageable. Loans for these spaces generally offer 20- to 25-year amortization schedules, which means your monthly payments stay lower and more affordable over time. And, unlike a lot of residential mortgages, you can lock in a fixed interest rate for up to 15 years, giving you predictability and security in the long run.
If you’re worried about early repayment fees, don’t be. With these commercial loans, you won’t be penalized for paying off your loan ahead of schedule — something that can’t always be said for home loans.
The costs of closing on a Personal Warehouse space are also straightforward. You’re looking at lower origination fees (generally falling between 0.5% and 1%). Appraisal fees? Reduced if you’re working with one of our preferred lenders. And importantly, there’s no private mortgage insurance (PMI) to worry about, which can often be a burden when purchasing a home.
Move In Faster Than You Think
We’ve all heard stories about long, drawn-out closing processes. Months spent waiting on contingencies, appraisals, inspections, money in escrow… it can be a real production.
That’s just not the case with a commercial loan for a Personal Warehouse.
You can expect to close on your new space within 45 to 60 days, so you won’t be left waiting around forever to start using your new warehouse for business, personal use, or as an investment.
Why Owning Beats Renting
So why buy your commercial space instead of rent? It comes down to control and long-term benefits. When you own a Personal Warehouse, you’re in charge. No more rent hikes, no landlords dictating what you can and can’t do with the space. Plus, you have the freedom to customize your unit to suit your specific needs.
And instead of rent being the largest item on your liabilities ledger… your space becomes an asset you’re building equity in (it’s also usually less money per month than renting, anyway… seriously).
From a financial standpoint, owning also sets you up for long-term investment potential. Commercial real estate generally appreciates over time, adding to the value of your purchase (as opposed to flushing rent money down the drain).
Ready to Take the Next Step?
Financing a Personal Warehouse might be easier than you think, and with the right approach, you can be well on your way to owning a versatile, income-generating space in no time. Whether it’s for business, personal use, or as a long-term investment, there’s a solution that fits your goals.
Reach out today to get started — we’d love to help you find the right space.