The Federation of small businesses reports that there were 5.6 million small UK business at the start of 2018, and the UK real estate market is still a very desirable investment. The appeal of owning commercial property, whether to run a business from it, or rent out the space is keeping the UK commercial property finance market a highly competitive industry.
There are many types of commercial property finance, and many factors that influence the type of lending required. Industry, length of term, size of business and client risk profile are all aspects that potential commercial lenders will assess.
Anyone can apply for commercial property finance from small start-ups to large established businesses. Some lenders are more specific to the industry for example; hospitality or retail and can offer more specialised plans depending on the property investment and circumstances.
Adaption and flexibility
Commercial lending has had to adapt in recent times as owners and tenants are demanding more flexibility. Commercial office space in particular has had an influx of people looking for flexible working spaces. The evolution of “hot desks” and remote working requires owners to provide shorter leases to tenants.
The commercial property finance industry has had to meet the changing needs of commercial property investors, moving away from very rigid lending solutions and offering more customisable commercial lending options.
Owner vs Tenant
The commercial property market is not just for investors. When owning and operating a business there are many reasons to consider commercial property finance and purchase a building as opposed to renting a space.
Depending on the type of commercial property acquired, mortgage payments may not differ greatly from rental payments. Property prices are frequently rising so there is always the opportunity for capital gains and a premises could experience a significant increase in value over a short time.
Working with a broker like Stewart Hindley is advisable when considering commercial lending. Extensive market knowledge means they can source the best deal available and offer expert advice on how to proceed. Commercial property finance can be quite complex and it is important to have a strong understanding of what potential lenders may need and how to present an attractive proposal to successfully secure commercial lending.
Stewart Hindley Commercial Finance can advise the type of funding you are likely to need following a no obligation consultation and suggest the best approach.