Buying commercial property for your business premises

According to a recent report by property group Raine & Horne¹, a growing numbers of Australian business owners are taking advantage of low interest rates to own rather than lease their commercial premises.

It’s an option that can offer multiple benefits.

Owning your premises provides security of tenure – something that can be critical if the success of your enterprise hinges on a particular location.

For others, particularly businesses in the retail space, leasing can see landlords impose strict rules about how often the premises need to be refurbished. This can mean a significant capital investment every few years, putting fresh demands on your business’s cash flow.

A competitive lending market

As a business owner, you can take advantage of a variety of options with regard to holding your commercial property. It can be owned by the proprietors (that’s you), by the business itself or possibly through a trust.

Each of these choices involves different pros and cons. The choice best suited to your needs will depend on your circumstances and how the ownership and operation of your business is structured.

Exceptionally low rates

Overarching these choices is the reality that the commercial property lending market is offering some exceptional deals at present.

Mortgage Choice brokers are seeing commercial property loans with rates that are only marginally higher than home loan rates. It’s a far cry from the days when commercial property loans came with considerably higher interest rates.

The key take-out is that now could be the time to bring security to your business, by owning rather than leasing your commercial property.

It could be a far more affordable option than you realise.

Expert help is available

Commercial property can be a more complex asset class than residential property, so it’s important to speak to your local Mortgage Choice Broker to discuss different financing options and lender requirements.

Your local Mortgage Choice broker can also work with your accountant to find the lending solution and ownership structure that’s right for your circumstances. 

As small business owners ourselves, we understand how commercial finance works and can provide valuable insights to get your loan application across the line.

Contact us today for expert advice on how to finance ownership of your business premises.

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• Commercial Property

¹ Raine & Horne media release: Australian commercial property on track for FY gains of up to 10%, 30 April 2018