For an established business, buying premises converts rent into equity and fixes the cost of occupation against a landlord's review cycle. Lenders typically advance 65% to 75% of the property value for owner-occupiers, underwritten on the business's ability to service the debt — two to three years of accounts, current management information and a sensible debt service coverage are the core of the case.
For contractor company directors, the relevant version of this is often modest and specific: buying a small office or unit through the company (or a pension — see below) rather than renting serviced space. We have modelled exactly this structure for clients, including the corporation tax and related-party considerations when the company occupies premises its directors own.
We offer specialist commercial mortgage solutions for business owners and property investors. Whether you’re purchasing premises, investing in commercial property, or financing a mixed-use building, we’ll help you find the right lending option.
Commercial investment mortgages are assessed on the strength of the lease, tenant quality and the property's long-term investment potential.
Lease quality and tenant strength influence lending.
Commercial property can offer stronger rental returns.
We assess the lease before approaching lenders.
Commercial property is one of the few assets a pension can hold directly, and business owners buying their own premises through a SIPP or SSAS access a powerful structure: the pension buys the property (borrowing up to 50% of the scheme’s value if needed), the business pays rent to the pension — deductible for the business, tax-free growth inside the pension — and the asset sits outside the estate and outside the business’s creditors.
Pension property purchase involves regulated pension advice alongside the lending, and the rules are precise. We coordinate the lending leg with your pension adviser and accountant where this structure fits — for professional premises in particular, it is frequently the most tax-efficient ownership available.
Commercial applications are packaged, not form-filled. Owner-occupier cases need accounts, management figures, bank statements, details of the property and the business plan for occupying it. Investment cases need the lease, tenancy schedule, tenant covenant information and the property’s income history. All cases need a clear statement of the deal: price, contribution, purpose and exit or repayment basis.
The packaging quality directly affects the terms offered — commercial lenders price the risk they can see, and an organised case reads as lower risk. This is the core of what we do on every commercial file before any lender sees it.
Bridging is more expensive than term lending, and anyone who suggests otherwise is selling. Beyond the monthly interest, expect an arrangement fee of typically 1.5% to 2%, valuation fees, the lender’s legal costs as well as your own, and possibly an exit fee with some lenders. On a £300,000 bridge at 0.85% per month over nine months, the all-in cost can reach £30,000 to £35,000.
The right question is never whether bridging is cheap — it is whether the cost is justified by what it buys: the property secured at auction below market value, the chain saved, the uplift created by the refurbishment. We present the full cost honestly alongside the alternatives, and there are cases where our advice is that bridging is the wrong answer.
Owner-occupiers typically need 25% to 35%; commercial investment purchases 30% to 40%, with the exact figure driven by the tenant covenant and lease length. Additional security or a strong trading history can improve leverage. Pension purchases work differently again, with borrowing capped at 50% of scheme assets.
Yes — owner-occupier commercial lending is available to limited companies including contractor companies, underwritten on the company’s accounts and the directors’ position. For smaller premises, also consider the pension route (SIPP/SSAS) and personal ownership with the company as tenant — each has distinct tax consequences we work through with your accountant before choosing the lending.
On the lease above all: tenant covenant strength, unexpired term, rent against market level, and re-letting prospects. The lender stresses the rent against the debt service. A long lease to a strong tenant transforms the terms available; a short lease to a weak covenant limits leverage regardless of the bricks.
Yes — commercial risk prices above residential, with margins varying by asset quality, covenant and leverage. The compensating factors are the yields commercial property generates and, for owner-occupiers, the rent no longer paid to a landlord. The relevant comparison is the deal’s economics as a whole, not the rate against your home loan.
The lender’s core affordability test: the income available (business profits for owner-occupiers, rent for investments) divided by the annual debt cost, with most lenders requiring 125% or more after stressing the rate. It is the commercial equivalent of the residential ICR, and structuring the loan term and amortisation to satisfy it is part of how cases get packaged.
It is harder but not closed. Newer businesses can support owner-occupier lending with strong projections, relevant track record elsewhere, larger deposits or additional security. For investment purchases, the lease does most of the underwriting work, so the borrower’s trading history matters less. We are honest case by case about what is achievable.