The UK commercial property market offers exciting and profitable opportunities for landlords looking to explore beyond residential lettings. With longer contracts and the potential for more stable lets, commercial property investments can lead to superior returns. With access to flexible, low-cost mortgages, Clifton Private Finance is here to support your commercial property needs.
Key Takeaways
- Commercial investment mortgages provide the long-term funding required to purchase commercial property in the UK
- Clifton Private Finance are a whole-of-market specialist broker, working on your behalf to secure the right mortgage for your needs.
- Through our relationships with banks and specialist lenders, we are able to offer LTVs up to 80% in many circumstances.
- Commercial property investment offers the opportunity for both long-term investment and ongoing annual rental profits.
Investing in UK Commercial Property
Selecting the right commercial property can result in strong rental yield and an impressive long-term investment. While some areas of the UK commercial property market have struggled in recent, post-COVID years, general outlooks are positive, with many well-managed commercial property ventures equaling or outstripping residential profitability.
Areas to consider include:
- Warehousing and industrial units - Steady and unbridled growth of the worldwide e-commerce industry has boosted the country’s need for premium warehousing and industrial space. The logistics sector provides stable tenants for shrewd investors looking to capitalise on this comfortable market.
- Retail parks - While city centre retail spaces are struggling to maintain an advantage, the move to out-of-town retail spaces offers a considerable return for investors. Large-scale tenants with expanding retail businesses can be relied upon for longer-term contacts and fewer void periods.
- Prime sector office space - Inner-city offices remain a stable investment; having recovered from the downturn that followed the pandemic, firms are looking to rebuild centralised working environments. Care should be taken with office investments, however, with prudent research undertaken to determine profitable areas.
- Residential-adjacent premises - Leisure, hospitals, and education facilities typically offer longer leases with government links for commercial property investment, providing investors with a competitive long-term return.
Partnering with Clifton Private Finance will provide you with access to the whole market of UK commercial investment mortgage lenders, giving you the buying power you need to make a valuable investment in these profitable real estate sectors. We have worked with specialist banks and lenders who provide mortgages for:
- Offices
- Factories
- Warehouses
- Industrial Units
- Retail Outlets
- Nursing and Care Homes
- Doctor and Dental Surgeries
- Restaurants
- Pubs
- Hotels
- Schools and Nurseries
High Loan-to-Value Commercial Investment Mortgages
Making the right investment requires strong financial backing in order to reduce the drain on existing capital and provide a comfortable repayment structure with minimal impact on cash flow.
At Clifton Private Finance, we work with specialist lenders who will consider your application holistically, evaluating your specific investment to provide the best loan-to-value (LTV) possible.
Together, we can look at commercial mortgages with as much as 80% LTV (depending on circumstance). These higher-value mortgages give you the opportunity to make a sizeable investment with reduced risk.
Through a combination of selective loan terms - from three months to 30 years, a watchful eye on market forces and rates, and matching to understanding specialist lenders, Clifton Private Finance can ensure you obtain a mortgage that is tailored to your unique investment profile.
Bridging Options to Maximise Opportunities
Investing in commercial property is often time-sensitive, requiring agility to move on deals as they become available. Though commercial investment mortgages can be secured smoothly in a relatively short period, the application process and detailed underwriting needed by the lenders may cause delays that risk opportunities slipping through your fingers.
Clifton Private Finance’s business bridging team offers rapid financing options through commercial bridging, providing funds when they are needed through an exit-based structure that allows for immediate financing through a commercial investment mortgage once the dust has settled.
This can improve in several situations:
- When purchasing through auction.
- If properties need immediate renovation.
- To bridge the gap while funds are delayed, such as when liquidating other investments.
To learn more about commercial bridging, explore the specialist articles in our knowledge base.
Building a Portfolio
Maximising your investment is often achieved through the purchase of multiple commercial properties, leading to a strong portfolio of commercial buildings. When you develop a wider spread of property assets, you mitigate risk, reduce fully void periods, and improve the power of your equity.
A commercial property portfolio mortgage is a consolidated product that brings all your individual commercial investment mortgages into one single loan, ideal for improved investment, future growth, and equity leverage. To learn more about commercial property portfolio mortgages, read our article.
Preparing for a Commercial Investment Mortgage
Ensuring your paperwork is in order is vital for a smooth mortgage application process. Lenders will want to be able to confirm your identity and establish your finances, ensure that the property is bringing in income (or will), and establish the provenance of your deposit.
Lenders will want to see:
Basic Information
- Identity and registration documentation for you and your business
- Business and personal accounts, including up to six months’ bank statements
- Landlording experience summary, detailing your background in previous property investment
- Current property porfolio
- Sale agreement for new property
- Tenancy schedule if currently let
- Lease agreements
- Rental yield evaluation
- Commercial EPC (Energy Performance Certificate)
- Planning and use class evidence
- Business plan
- Deposit provenance
- Cash flow forecast
- Details of any other investors or relevant parties
Property Information
- Sale agreement for new property
- Tenancy schedule if currently let
- Lease agreements
- Rental yield evaluation
- Commercial EPC (Energy Performance Certificate)
- Planning and use class evidence
Funding Information
- Business plan
- Deposit provenance
- Cash flow forecast
- Details of any other investors or relevant parties
In addition, lenders may want to see additional information based on the property type. For example, educational premises may need to include recent Ofsted reports, while pubs will need to show the relevant licenses.
Working with Clifton Private Finance ensures that your application process is smooth. We will advise you on the administration needed prior to your application and perform pre-checks to ensure everything aligns with the lender’s expectations.
Obtaining a Commercial Investment Mortgage with CPF
At Clifton Private Finance, our business mortgage team is here to help you get the mortgage you need. We will explore the full marketplace for suitable lenders, matching you to the right provider who will best align with your specific circumstances.
With CPF, you get:
- Experienced advice, tailored to your situation and requirements.
- Access to the whole marketplace of UK mortgage lenders.
- Greater LTVs, lower rates, and more flexible mortgage terms.
- Multi-product solutions that can provide rapid bridging where needed.
- Ongoing support throughout the process and beyond.
To make a move into profitable commercial property investment, contact Clifton Private Finance today.
