Mortgages
Commercial Mortgages
Commercial mortgages are underwritten on the property's income and your business's strength, not a formula. The mortgage is processed through RMA Mortgages; we help package your deal the way lenders want to see it and coordinate the closing. You are free to use your own lawyer; discounted legal fees are available when Marwah Law handles the closing.
- Multi-Unit Residential and Mixed-Use
- Retail, Office and Industrial
- Owner-Occupied Business Premises
- Discounted Legal Fees on Commercial Mortgages*
Property Types Financed
Purchase, refinance and construction mortgages for income-producing and owner-occupied commercial real estate in Ontario, processed through RMA Mortgages.
- Apartment buildings and multi-unit residential, including CMHC-insured options
- Plazas, retail units and restaurants
- Office buildings and medical or professional space
- Warehouses, industrial condos and manufacturing facilities
- Land and development projects
Financing the Premises Your Business Operates From
Lenders underwrite an owner-occupied property on the strength of the business that will pay for it: cash flow, years of statements and the owners' covenant. That is different from an investment property, which is underwritten on its rental income. The mortgage is processed through RMA Mortgages, and our team plans it as part of your business's overall banking, so the loan fits alongside your operating line and term debt rather than competing with them.
- Buying the unit, plaza, warehouse or office your business already rents
- Refinancing to release equity for growth or to consolidate debt
- Construction and fit-out of purpose-built premises
- Multi-unit buildings where the business occupies part and rents the rest
How Commercial Underwriting Differs
Lenders look at the debt service coverage ratio, the quality of the leases, the tenant mix and the borrower's covenant. Terms, amortization and fees vary widely between lenders, which is why comparing them matters.
For owner-occupied premises, banks, credit unions and specialised lenders typically finance 65 to 80 percent of the appraised value, amortized over 15 to 25 years. Government-backed routes, including the Canada Small Business Financing Program and BDC, can raise the loan-to-value for smaller purchases. The remainder comes from equity, vendor financing or a second facility, which our team can help you plan.
What to Prepare
A rent roll, operating statements, an appraisal or environmental report if available, corporate financial statements and a summary of the business plan. For owner-occupied premises, two to three years of business financial statements and a purchase agreement or refinance target; environmental reports for industrial sites. We provide a checklist for your property type.
FAQ
Common Questions
What down payment is required on a commercial property?
Typically 25 to 35 percent for an investment property, less for CMHC-insured multi-unit residential, and typically 20 to 35 percent for owner-occupied premises, where government-backed programs can reduce it for smaller purchases.
Should the property be owned by the business or a holding company?
Many owners hold the property in a separate company and lease it to the operating business. The right choice depends on tax and liability, so discuss it with your lawyer and accountant before you sign the offer.
How long does a commercial mortgage take?
Longer than a residential mortgage. The appraisal, any environmental report and the lender's review of the property and the business all have to be completed first. We set out the steps and the documents at the start so nothing holds the file up.
What is the debt service coverage ratio?
It compares the property's net operating income with its annual mortgage payments. A ratio above 1.0 means the income covers the payments; most lenders want a margin above that, and the minimum varies by lender and property type.
Get Started
Tell Us About Your Situation
Share a few details. Our team will review your request and contact you with the next steps and the documents to prepare.
Talk to a Commercial Lending Advisor
Tell us what you need and our team will explain your options and the next steps.