I am trying to find a lender or lenders that offer financing with a minimal down payment for multiple professional office properties that are all under long-term lease agreements with the current tenant. I was told a few years ago that there were some podcasts on BiggerPockets about some special lenders who do offer this type of lending. I have looked into a possible SBS 504 funding; however, I am looking at a range of around $6-6.5 million for all the properties that are being sold as a portfolio, and the SBA doesn't offer lending over $5 million, I was told. The business would be located in Minnesota, and the properties in question would be spread out in 3 different states in the Midwest. Thanks for any help in steering me in the right direction.
I am trying to find a lender or lenders that offer financing with a minimal down payment for multiple professional office properties that are all under long-term lease agreements with the current tenant. I was told a few years ago that there were some podcasts on BiggerPockets about some special lenders who do offer this type of lending. I have looked into a possible SBS 504 funding; however, I am looking at a range of around $6-6.5 million for all the properties that are being sold as a portfolio, and the SBA doesn't offer lending over $5 million, I was told. The business would be located in Minnesota, and the properties in question would be spread out in 3 different states in the Midwest. Thanks for any help in steering me in the right direction.
Can you PM me? I may have some people in my network that can help.
@Kevin Bristow There are several considerations. First, as you determined, SBA is not a great option to finance Real Estate. It is to finance a business that is not RE-related. You can buy a building to operate the business, but that is not what it appears you are doing here. It cannot be used to purchase a building you would rent to another, unless your SBA-financed company uses at least 51% of the building.
Second, your comment that the three properties are in different Midwest states complicates things and means you would either need to use a national lender or a different local lender in each state.
Third, I do not specialize in office, but what I know of office is that as an asset class, it is the most risky class right now. That means even if there were lower-level programs they are not likely to exist now. The best I know with reasonable rates is 25% down. It's possible with some digging, you might find a higher-priced option with 20% down. I doubt it would go lower than that, with the exception that if the national tenant is a A or better credit rating and you have NNN leases, then maybe a bigger player would take that at a lower rate, but I highly doubt they would allow lower leverage on office right now.
Financing multiple professional office properties across states can definitely be challenging, especially when trying to minimize down payment requirements. I work with a network of lenders who specialize in structured commercial financing and can often accommodate multi-property portfolios, even where traditional options like SBA 504 fall short.
If you’re open to a conversation, I’d be happy to learn more about the portfolio and see how we might structure a solution that fits your goals.
Hi Kevin, this sounds like an interesting portfolio! We work with lenders who can offer financing solutions for multi-property professional office deals, including options with minimal down payment. Feel free to send me a message. I’d be happy to explore how we might help you structure the funding.