Commercial Lenders ?

[Brit Foshee]

My portfolio currently consists of residential, income properties.  I have a contract to sell a property that has had substantial gains.  My plan is to 1031 those gains into a commercial property.

With the 180 day time frame on the 1031, I want to make sure I have as much together as possible going into the sale of the original property.

I know you typically show up to a lender with a "deal" and that with commercial lending it is more about the property than with residential.

With that being said, I am looking for commercial lenders in Florida who you'd recommend.  I want to sit down and make sure I have everything I need.  With commercial, I suspect that 180 clock to tick much faster than with residential.

What lenders would you recommend ? 

[Chris Winterhalter]

@Brit Foshee 

First nice job on the residential property sale.

For commercial financing it really depends on your deal size & property type.  Commercial is very broad & many lenders specialize.  Deal size & property type will dictate your direction.  

Under 1MM-2MM in loan size 

Then you need to find a local/regional bank or credit union.  Loans will generally only be fixed for 3,5,7 years & many with balloons.  Amortization is generally 20 years with some going up to 25 years.  Full or limited recourse.  

Find the lenders who are lending on this type of property in your area on a regular basis.  Talk to 5-10+ lenders about your scenario.  Give them as much information about your personal situation as possible.  They will tie the loan towards the property but also your global income.  Talk to brokers & investors for referrals on who is currently funding their deals.  The more banking contacts you have before you get the deal under contract the better.  

Over 1MM-2MM+ in loan size 

Then you can enter the capital markets with CMBS, Life Insurance, etc debt. This will generally be non-recourse but will come with slightly higher premiums under the 5MM space. Closing & legal costs are higher than local banks. However you can generally lock in 10 year fixed rates. Underwriting will be different from a local bank. Net worth generally needs to equal loan size.

Find the lenders who specialize in your commercial property type.  Find a local or region firm in your area as well.  Reputation is everything & you want to make sure you are working with a firm that understands the process (especially since it's your first deal).  Be as honest with them as you are with the local bank.  Don't leave details out and run by any scenarios that you think might be challenges.  

Be as organized as possible with your offering package & executive summary.  Organization goes a long way to streamlining the process (with all lenders).  Make sure you understand what the lenders want when you get the deal under contract.  Good luck!