A commercial property investment loan is used to purchase or refinance income-producing property held for investment purposes — such as office buildings, retail centres, industrial warehouses, or mixed-use developments. Unlike owner-occupied commercial loans, investment loans are assessed primarily on the income generated by the asset and the strength of the tenancy profile. Loan structures vary significantly across lenders, making broker guidance essential.

Most lenders will lend up to 65–70% of the property’s value (LVR) for commercial investment, though some specialist lenders can go higher depending on the asset type, tenancy, and borrower profile. Serviceability is typically assessed on the net rental income from the property, and lenders will apply a vacancy buffer. Cross-collateralisation with residential assets can sometimes be used to increase overall borrowing capacity.

Eligible commercial investment properties typically include office buildings, retail shops and strip centres, industrial units and warehouses, medical and professional suites, and mixed-use properties. Lender appetite varies by asset class — some lenders are more selective about specialised assets such as service stations, childcare centres, or hospitality venues. We work with a broad lender panel to match your asset type to the right credit appetite.

Serviceability for commercial investment loans is primarily assessed on the net rental income generated by the property, after deducting outgoings, management costs, and a vacancy allowance (typically 10–20%). Lenders then apply a stressed interest rate to confirm the property can service the debt. Strong tenant covenants and long lease terms improve the lender’s assessment. Some lenders also factor in the borrower’s personal income as a secondary support.

Commercial investment yields vary by asset class, location, and market conditions. Industrial assets in metro areas have compressed to 4–6% in recent years, while office and retail assets often range from 5–8%. Regional and secondary assets may offer higher yields but carry greater vacancy risk. Lenders focus on the quality and certainty of the income stream rather than yield alone — a long lease to a strong tenant is typically viewed more favourably than a high yield with short tenure.

Yes. SMSFs can borrow to purchase commercial property through a Limited Recourse Borrowing Arrangement (LRBA). This is a popular strategy for business owners who purchase their own business premises through their SMSF and lease it back to their operating company. Lenders offering SMSF commercial loans typically require a minimum fund balance, strong rental income, and compliance with superannuation legislation. We specialise in SMSF lending and can guide you through the structure.

Commercial lending differs from residential in several key ways: lower maximum LVRs (typically 65–70% vs 80–90%), serviceability assessed on property income rather than personal income alone, shorter loan terms (typically 5–15 years with interest-only options), higher interest rates, and more complex security and valuation requirements. Commercial loans are also generally not regulated under the National Consumer Credit Protection Act, giving lenders more flexibility in structuring.

Commercial loan approvals typically take longer than residential — generally 2–6 weeks from application to formal approval, depending on the complexity of the deal, valuation turnaround times, and lender credit appetite. Having a complete application prepared upfront — including lease documentation, tenancy schedules, and financials — significantly reduces delays. We pre-qualify deals with lenders before formal submission to minimise back-and-forth and improve approval timelines.