Historically, property investors over the last several years have invested heavily in the buy to let sector. However, many investors have seized the opportunity to expand their property investment portfolio by moving out of buy to let and into commercial property investment.
Buy to let -vs. - commercial property finance.
Investing in commercial property is an attractive option compared with buy to let for a number of reasons:
Buy to let tenants occupy the property on an Assured Short-hold Tenancy (AST) - which is normally for a relatively short period of time - usually 6-12 months
Investors who own buy to let properties are responsible for insuring the property and also for all repairs and maintenance.
Commercial investment property is structured differently:
The property is let on something called a Fully Repairing and Insuring (FRI) lease
The lease period is much longer - typically between 10 and 25 years
Under FRI lease agreements, the tenant is responsible for insurance costs and for repairs and maintenance
These differences make investing in commercial property an attractive option which many investors are now taking advantage of.
When applying for finance for commercial property investment several factors need to be considered and taken into account. For instance lenders will analyse who the tenant is - are they "blue-chip", or are they a secondary or tertiary tenent? This is just one factor that will determine how much funding is available. Lenders will also look at the terms of the lease, the presence of any break clauses, the amount of the rent, and other factors such as the amount of residual debt that can be left in place at the end of the lease.
, with over 20 years experience are specialists in finance for this type of property investment. Our long-standing relationships with commercial lenders in the UK mean direct access to the decision makers who can negotiate and sign off on your financing. A variety of options are available for you to consider, such as fixed rate or variable rate loans, interest only payments, terms linked to the length of the lease including residual debt options and many others.
Visit for more details. We will be happy to provide the right DIY Funding Pack to suit your specific financing needs.
