A commercial mortgage is long-term finance secured against property used for business - the premises a company trades from, or an income-producing investment such as offices, retail units, industrial space or mixed-use buildings. Whether you're a business owner buying your own premises, an investor adding a commercial asset to a portfolio, or a developer holding a completed scheme for income, the right facility is the one structured around the property, the income and your plans for it.
This page is for businesses and investors arranging finance secured on commercial or mixed-use property in London and across the UK. We work across a broad lender panel - from clearing banks and challenger banks to specialist commercial lenders - to match your case to lenders who understand the asset and the way it earns.
Key facts
- Who it's for: owner-occupier businesses buying their premises, and investors or landlords financing commercial and mixed-use property.
- Property types: offices, shops and retail, warehouses and industrial units, mixed-use buildings, and many specialist and semi-commercial assets.
- Loan basis: typically assessed on the property's value and either the trading business's affordability (owner-occupier) or the rental income it produces (investment).
- Terms: commercial mortgage terms and rates are set case by case, reflecting the asset, the covenant and the risk - they are individually negotiated rather than off-the-shelf.
- Regulation: most commercial mortgages are not regulated by the FCA. Where a loan is secured on a borrower's own home, or otherwise meets the criteria for a regulated contract, regulated protections apply.
How commercial mortgages work
Commercial lending divides broadly into two purposes, and lenders underwrite each differently.
Owner-occupier finance is for a business buying the premises it trades from. Here the lender looks closely at the trading business - its accounts, profitability and ability to service the loan - as well as the value of the property itself. Buying rather than renting can give a business control over its premises and turn rent into an asset on the balance sheet, though it also ties up capital and exposes the business to property value movements.
Commercial investment finance is for buying property to let to business tenants. The lender focuses on the rental income, the strength and length of the tenancies, and the quality of the building, applying rental cover tests in much the same spirit as buy-to-let underwriting but with commercial nuances around lease terms, tenant covenant and void risk.
In both cases, pricing and terms are individually assessed. There is no single advertised rate for commercial mortgages the way there is on a high-street residential deal - the figures depend on the asset, the income, the term and the borrower.
The regulatory reality
Most commercial mortgages are unregulated business lending and sit outside the FCA's mortgage rules. That gives lenders more flexibility on structure, but it also means the consumer protections that apply to residential mortgages may not apply. Some arrangements - for example a loan partly secured on the business owner's home, or certain mixed-use cases - can fall within the regulated regime, which changes the rules that apply and the protections available.
Working out where a particular case sits is part of structuring it properly. We identify whether your transaction is regulated or unregulated at the outset, so you understand the basis on which you're borrowing.
Where any element of the lending is secured on a residential property you live in, your home may be repossessed if you do not keep up repayments on a mortgage secured on it.
Which lenders, and why a specialist broker helps
The commercial market is fragmented. Clearing banks, challenger banks, specialist commercial lenders and some private banks all operate here, and each has its own appetite - for sectors, property types, locations, loan sizes and borrower profiles. A warehouse let to a single tenant, a parade of shops with flats above, an owner-occupied office, a leisure asset or a semi-commercial building can each suit a quite different set of lenders.
Propertyze has access to a broad panel and a sourcing platform covering commercial criteria, so we can quickly narrow the field to lenders genuinely likely to fund your asset, then present your case in the way each one underwrites. On commercial deals - where decisions hinge on trading accounts, lease structures, tenant strength and valuation - that targeting and packaging is where a broker earns its place, often improving both the terms and the certainty of completion.
Common complications we handle
- Mixed-use and semi-commercial property, where residential and commercial elements need a lender comfortable with both.
- Owner-occupier affordability, presenting trading accounts so the business's true capacity to service the loan is clear.
- Investment cases with complex tenancies - shorter leases, multiple tenants, or covenant questions.
- Specialist and less standard assets that mainstream lenders shy away from.
- Refinancing existing commercial debt, including raising capital or improving terms.
- Limited company and SPV ownership structures, common for commercial investment.
The process
- Conversation. We learn about the property, its use, the income or business behind it, and your objectives.
- Structure and regulation check. We confirm the right structure and whether the deal is regulated or unregulated.
- Lender match. We shortlist lenders whose appetite fits the asset and the case.
- Indicative terms. We seek heads of terms so you can see the likely shape of the deal.
- Application, valuation and offer. We package the full application, manage the valuation and legal process, and see it through to drawdown.
FAQ
What is a commercial mortgage? Long-term finance secured against property used for business - either premises a business occupies itself, or commercial property held as an investment and let to tenants.
What types of property can be financed? Offices, retail units, warehouses and industrial buildings, mixed-use property, and many specialist assets. The right lender depends heavily on the property type and how it's used.
How are the rate and terms decided? Commercial terms are assessed case by case, reflecting the property, the income or trading covenant, the loan size and term, and the borrower's profile. They're individually negotiated rather than taken off a rate sheet, which is why we quote against your actual deal rather than a headline figure.
Is a commercial mortgage regulated? Most commercial mortgages are not regulated by the FCA. Some cases - for instance where part of the security is the borrower's own home - can be regulated. We confirm which applies to your transaction.
Can I buy through a limited company or SPV? Yes. Commercial property is frequently held in a company or special purpose vehicle, and many commercial lenders expect this. We arrange finance for individual, company and SPV borrowers.
How long does it take? Commercial cases typically take longer than residential, because valuations and legal due diligence are more involved. Timescales depend on the asset and lender; we set realistic expectations once we've seen the deal.
Talk to an adviser
Tell us about the property and how it's used, and we'll set out which lenders are likely to fund it and on what basis. Call 020 7126 8574 or request a call back - we reply within one working day.
Most commercial mortgages are not regulated by the Financial Conduct Authority. Where lending is secured on a residential property you live in, your home may be repossessed if you do not keep up repayments on a mortgage secured on it.
Propertyze is a trading style of City Finance Brokers Ltd, authorised and regulated by the Financial Conduct Authority, FCA No. 766295.