Commercial Real Estate Loans for Investors
Finance multifamily buildings, mixed-use properties, retail centers, office buildings, and industrial assets. Loan amounts from $500K to $50M+. We shop your deal across 50+ lenders to find the most competitive commercial mortgage for your property - nationwide.
No credit pull. No commitment. Takes 2 minutes.
What Is a Commercial Real Estate Loan?
A commercial real estate loan is a mortgage used to finance the purchase, refinance, or renovation of income-producing commercial properties. Unlike residential mortgages that are designed for single-family homes and small multifamily properties (1-4 units), commercial loans are built for larger, more complex assets - apartment buildings with 5 or more units, mixed-use buildings, shopping centers, office towers, industrial warehouses, and other property types that generate rental income from tenants.
What makes a property "commercial" from a lending perspective? The threshold is generally five or more residential units, or any property whose primary purpose is business or investment use rather than owner-occupied housing. A 4-unit building qualifies for residential financing. A 5-unit building does not - it requires a commercial mortgage. The same applies to retail storefronts, medical offices, distribution centers, and any other non-residential asset regardless of size.
The underwriting process for commercial loans differs fundamentally from residential lending. While residential lenders focus on the borrower's personal income and debt-to-income ratio, commercial lenders focus on the property's financial performance. The key question is whether the property generates enough net operating income to comfortably cover its debt obligations. This is measured through metrics like debt service coverage ratio (DSCR) and debt yield, which we explain in detail below.
At Sinai Capital, we are a commercial real estate lending brokerage that shops your deal across 50+ lender partners - including banks, credit unions, life insurance companies, CMBS lenders, agency lenders (Fannie Mae and Freddie Mac), debt funds, and private capital sources. Whether you are acquiring your first 5-unit apartment building or refinancing a $30 million retail portfolio, we find the best commercial property loan for your deal. Our coverage is nationwide, and our service costs you nothing - lenders pay our fee at closing.
How Commercial Loans Work
Commercial real estate lending revolves around the income the property produces. Lenders analyze the property's rent roll, operating expenses, historical financials, and market comparables to determine whether the asset can support the requested loan amount. Here is how the underwriting process works and the key metrics that drive approval:
Debt Service Coverage Ratio (DSCR)
DSCR = Net Operating Income (NOI) ÷ Annual Debt Service
Most commercial lenders require a minimum DSCR of 1.20x to 1.25x
The DSCR tells a lender how much cushion exists between what the property earns and what the mortgage costs. A DSCR of 1.25x means the property generates 25% more income than is needed to cover the annual debt payments. If the DSCR falls below the lender's threshold, the loan amount must be reduced until the ratio is met - or the borrower must bring additional equity to the table.
Debt Yield
Debt Yield = Net Operating Income (NOI) ÷ Total Loan Amount
Most lenders require a minimum debt yield of 8% to 10%
Debt yield is a lender's preferred risk metric because it cannot be manipulated by adjusting the amortization period or interest rate. It represents the return a lender would receive on its investment if it had to foreclose on the property. Institutional and CMBS lenders often use debt yield as their primary sizing constraint, especially for larger commercial loans.
Amortization vs. Balloon Payments: Most commercial real estate loans use a split structure. The monthly payment is calculated based on a long amortization schedule - typically 25 or 30 years - which keeps payments manageable. However, the loan itself has a shorter term of 5, 7, or 10 years. At the end of the term, the remaining principal balance (the "balloon") must be paid in full. Borrowers typically refinance into a new commercial loan or sell the property to satisfy the balloon payment. Some lenders offer full-term amortization (25 or 30 years with no balloon) for multifamily properties through agency programs.
The underwriting process for a commercial loan typically takes 30 to 45 days from application to closing. During this time, the lender will order a commercial appraisal, review the property's rent roll and trailing 12-month operating statements (T-12), evaluate environmental reports (Phase I), and assess the borrower's financial strength. Sinai Capital manages this entire process on your behalf, coordinating with lenders, appraisers, and title companies to keep your deal on track.
Key Features at a Glance
Loan Amounts
$500K – $50M+
Max LTV
Up to 75 – 80%
Loan Terms
5 / 7 / 10 / 25 / 30-yr
Amortization
25 – 30 years
Interest Rates
Competitive & fixed or floating
Close Time
30 – 45 days
Min DSCR
1.20 – 1.25x
Property Types
Multifamily 5+, mixed-use, retail, office, industrial
Terms shown are representative ranges. Actual rates, leverage, and terms vary by lender, property type, market, and borrower profile. Your loan officer will walk you through exact numbers for your deal.
Eligible Property Types
Sinai Capital finances a wide range of commercial property types across all 50 states. Our lender network includes specialists for each asset class, which means we can find competitive commercial property loan terms regardless of what you own or are acquiring.
Multifamily (5+ Units)
Apartment buildings, garden-style complexes, mid-rise and high-rise multifamily. This is the most commonly financed commercial property type and offers access to agency lending (Fannie Mae, Freddie Mac) with the most competitive rates and terms in the market.
Mixed-Use Properties
Buildings that combine residential units with ground-floor retail or office space. Lenders typically require that 50% or more of the building's income comes from the residential component to qualify for the best terms. Mixed-use properties are common in urban and suburban corridors.
Retail Centers
Strip malls, neighborhood shopping centers, single-tenant net lease properties (NNN), and anchored retail plazas. Lenders evaluate tenant quality, lease terms, and remaining lease duration when underwriting retail properties.
Office Buildings
Class A, B, and C office buildings, single-tenant and multi-tenant. Office lending requires strong occupancy rates and creditworthy tenants. Suburban office properties and medical office buildings are popular asset classes in our lender network.
Industrial & Warehouse
Distribution centers, flex industrial, manufacturing facilities, and cold storage. Industrial properties have seen strong demand from institutional lenders due to the growth of e-commerce and supply chain expansion.
Self-Storage
Climate-controlled and non-climate-controlled self-storage facilities. Lenders evaluate occupancy trends, revenue per square foot, and market saturation. Stabilized self-storage properties with 85%+ occupancy qualify for attractive commercial loan terms.
Mobile Home Parks
Manufactured housing communities where tenants own the homes and lease the land. Mobile home parks offer strong cash flow and low tenant turnover, making them attractive to both investors and lenders. Financing is available for parks with 20+ pads.
Do not see your property type listed? Contact us at (732) 754-2144. We finance hospitality, healthcare, special-purpose, and other commercial property types through specialized lender partners.
Commercial Loan Qualification Requirements
Commercial real estate lenders evaluate both the property and the borrower. While the property's income is the primary driver of approval, your financial profile matters too. Here are the key requirements most commercial lenders in our network look for:
Debt Service Coverage Ratio (DSCR)
The property must demonstrate a minimum DSCR of 1.20x to 1.25x, meaning its net operating income is at least 20-25% higher than the annual mortgage payment. Agency lenders may accept 1.15x for strong multifamily deals. Properties with a DSCR below the minimum threshold may still qualify with a lower loan amount or additional borrower equity.
Debt Yield
Most lenders require a minimum debt yield of 8% to 10%. This metric is calculated as NOI divided by the loan amount. A higher debt yield signals lower risk and can result in better pricing. CMBS and institutional lenders typically use debt yield as their primary loan sizing constraint.
Credit Score
Most commercial lenders require a minimum credit score of 660 to 680 for the primary borrower or guarantor. Scores above 720 will qualify for the best rates. Some private lenders accept lower scores with compensating factors such as higher equity, stronger property performance, or significant borrower experience.
Net Worth
Most commercial lenders require the borrower's net worth to equal or exceed the loan amount. This does not mean you need to have the full loan amount in cash - net worth includes real estate equity, retirement accounts, and other assets. For small balance commercial loans under $2.5 million, net worth requirements may be more flexible.
Liquidity / Reserves
Lenders typically require 6 to 12 months of debt service reserves in liquid accounts (cash, savings, money market). Some lenders will count a portion of retirement accounts toward liquidity. Reserves demonstrate that you can service the loan during periods of vacancy or unexpected expenses.
Real Estate Experience
Many commercial lenders prefer borrowers with prior experience owning or managing investment properties. First-time commercial investors can still qualify, but may need to work with an experienced property manager or bring on a co-sponsor with a track record. Our loan officers can guide you through the best strategy for your experience level.
Sample Commercial Loan Scenario
To illustrate how a commercial real estate loan works in practice, here is a realistic deal walkthrough.
David is purchasing a 24-unit apartment building in Houston, Texas for $2,400,000. The property is fully stabilized with a 95% occupancy rate and strong in-place rents. David has a 720 credit score, $3.2 million in net worth across his real estate portfolio, and has owned multifamily properties for eight years. He wants a fixed-rate loan with a 25-year term and manageable monthly payments.
Purchase Price
$2,400,000
Down Payment (25%)
$600,000
Loan Amount (75% LTV)
$1,800,000
Net Operating Income (NOI)
$204,000 / year
Annual Debt Service
$156,000 / year
DSCR
1.31x
Debt Yield
11.3%
Loan Term / Amortization
10-yr term / 30-yr amort.
DSCR Calculation: $204,000 (annual NOI) ÷ $156,000 (annual debt service) = 1.31x DSCR
Debt Yield Calculation: $204,000 (NOI) ÷ $1,800,000 (loan amount) = 11.3% debt yield
David's deal comfortably exceeds the minimum DSCR of 1.25x and the minimum debt yield of 8%. His strong credit, significant net worth, and years of multifamily experience further strengthen the application. Sinai Capital shops the deal across our network and secures a 10-year fixed-rate commercial mortgage with a 30-year amortization schedule from an agency lender at competitive terms.
Outcome: David closes in 38 days. His monthly mortgage payment is $13,000, while the property generates $17,000 per month in NOI - leaving $4,000 per month ($48,000 per year) in positive cash flow after debt service. At the end of the 10-year term, David will either refinance the remaining balance or sell the property, which he expects to appreciate significantly given the strong Houston rental market.
Frequently Asked Questions About Commercial Real Estate Loans
What is a commercial real estate loan?+
How is a commercial real estate loan different from a residential mortgage?+
What is debt yield and why does it matter?+
What is a balloon payment on a commercial loan?+
What is the minimum DSCR for a commercial real estate loan?+
How does commercial loan amortization work?+
How fast can Sinai Capital close a commercial real estate loan?+
Ready to Finance Your Commercial Property?
Fill out our quick form and a Sinai Capital loan specialist will call you within 5 minutes to discuss your commercial loan options. We shop your deal across 50+ lenders to find you the best rate and terms - at no cost to you. Nationwide coverage for all commercial property types.
No credit pull. No commitment. Takes 2 minutes.
Related Loan Products
Commercial real estate loans are one of many financing tools available to investors through Sinai Capital. Depending on your property type, deal structure, or investment strategy, one of these related products may also be a fit:
DSCR Loans
No-income-verification loans for 1-4 unit rental properties. Qualify based on rental income, not personal income. 30-year fixed terms available.
Portfolio Loans
Finance multiple properties under a single loan with one closing. Ideal for investors consolidating their rental portfolio for simplified management.
Bridge Loans
Short-term financing to acquire or stabilize a property before refinancing into permanent commercial financing. Close in as few as 7 days.