The commercial mortgage market is served by high-street banks, building societies, specialist commercial lenders, and insurance company lending arms — each with different criteria and sweet spots. High-street banks offer the lowest rates but apply the most conservative underwriting. Specialist lenders accept higher risk but charge accordingly. Finding the right fit requires understanding each lender's current appetite.
Tenant covenant assessment is central to commercial mortgage underwriting. Lenders want to know not just who your tenants are, but their financial stability, their lease terms, and whether the property could be re-let at similar rents if they vacated. Properties with government or blue-chip tenants on long leases attract the best terms.
Break clauses and lease expiries within the mortgage term create risk events that lenders price into their terms. If a significant tenant has a break option exercisable during your proposed mortgage term, expect the lender to stress-test the income coverage assuming that tenant departs. Renegotiating or removing break clauses before seeking finance can materially improve your available terms.
Prime residential values in Central London continue to attract international capital, while the suburban and Home Counties markets benefit from hybrid working patterns driving demand for larger homes with garden space. Developers who understand the micro-market dynamics — from Crossrail catchment areas to new Overground extensions — can achieve premium returns.
Indicative Terms
Typical terms available for commercial mortgages in Porthmadog. Actual rates depend on your project specifics and experience.
Interest Rate
From 5.5% p.a.
Loan to Value
Up to 75% LTV
Typical Term
3-25 years
Arrangement Fee
0.5-1.5% of facility
Rates shown are indicative and subject to individual assessment. Contact us for a bespoke quote.
Representative Deal
Acquisition of a multi-tenanted office building with 6 tenants on lease terms ranging from 2 to 8 years. WAULT of 4.3 years with 85% occupancy at acquisition. A 15-year fixed-rate commercial mortgage was secured at 70% LTV, with the lender excluding the vacant floor from income covenant calculations for the first 12 months to allow for letting.
GDV
£4,200,000
Loan Amount
£2,940,000
LTV
70% LTV
Loan Type
15-Year Fixed Commercial Mortgage
This is a representative example. Actual terms vary based on project specifics.
Common Questions
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