Denver Commercial Mortgage Loans
Denver Commercial Mortgage Rates - Rates updated March 4th, 2021
|Loan Product||Rates (start as low as)||LTV|
|Multifamily Mortgage Rates (Over $6,000,000)||2.68%||Up to 80%||Get Free Quote|
|Multifamily Mortgage Rates (Under $6,000,000)||3.27%||Up to 80%||Get Free Quote|
|Single Tenant Lease Rates||3.25%||Up to 75%||Get Free Quote|
|Business Real Estate Loans||3.35%||Up to 90%||Get Free Quote|
|Commercial Mortgage Rates||3.60%||Up to 75%||Get Free Quote|
Select Commercial is a leading commercial real estate lender. We have excellent commercial mortgage loan products and options available for owners and purchasers of commercial real estate and multifamily buildings throughout the city of Denver. While we lend across the entire continental United States, we are able to give our best rates and loan programs to certain areas that we feel are strong markets. Denver is one of the cities that we consider to be a premium market and we actively look to originate good quality loans here for our clients. We have a diverse array of many available loan products to help qualified Denver borrowers looking to purchase or refinance a commercial property. If you are looking to obtain a multifamily building loan or commercial real estate loan, don't hesitate to contact us. There are many reasons why our customers like doing business with Select Commercial. We have a simplified application process and we do not charge any upfront application or processing fees. We typically offer 24-hour pre-approvals with no-cost and no-obligation. Our long term fixed rates are excellent, and we look to close within 45 days of application.
Denver Commercial Mortgage Benefits
Denver commercial mortgage rates start as low as 2.68% (as of March 4th, 2021)
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multifamily, 75% on commercial (90% with SBA)
• Terms and amortizations up to 30 years
• Loans for purchase and refinance, including cash-out
• 24 hour written pre-approvals with no cost and no obligation
Recent TRUSTPILOT Reviews
Select Commercial Funding Reviews from TRUSTPILOT
A three year journey
"Thanks Stephen for all of your hard work in getting our deal closed! I appreciate your professionalism and patience throughout a complicated process. You always were there for my partner and I whenever we had questions and needed answers quick. It was a pleasure to have worked with you and Select Commercial!"
Denver Multifamily Loan Information
Continued Wave of Tech Jobs Keep Builders Active; Colfax Avenue Fosters Bevy of Investment
Firms eager to capitalize on Denver’s tech talent. Bay Area tech companies remain a key driver behind Denver’s apartment market as they relocate to the Mile-High City, creating jobs in the area and capitalizing on local talent. This has brought an influx of high wage jobs to the area from companies such as Amazon and Slack, prompting developers to deliver luxury apartments to the urban core. Downtown Denver and its surrounding neighborhoods will receive more than half of the metro’s new multifamily supply in 2020, highlighted by several 300-plus apartment unit complexes. Despite the wave of upscale apartments, Class A vacancy has dipped to the mid-4 percent range, its lowest level in four years. The Class B and C multifamily segments boast even tighter readings in the low-4 and high-3 percent bands, respectively. Sustained job creation in service-oriented fields and ultra-tight unemployment will remain a boon to workforce housing this year, keeping upward pressure on rent growth for these properties. In the past five years, the Class C average effective rent increased 41 percent, while the Class B measure rose 30 percent. Investors looking at the Denver market would be wise to look for an apartment loan to finance their next purchase.
Buyers stay focused on key thoroughfare. Colfax Avenue remains the common denominator of many apartment deals as the corridor provides investors wide-ranging dynamics to fit various investment criteria. The eastern section in North Aurora provides favorable price points to many multifamily investors with per unit values averaging about $120,000 and cap rates reaching the mid-7 percent realm. Proximity to UC Health keeps apartment rental demand strong in this area as vacancy hovers under 4 percent. Moving west, the Capitol Hill neighborhood is highly targeted due to its adjacency to downtown and relatively affordable price points. Apartment buyers also zero in on North Lakewood, where the recently completed light rail extension has boosted the area’s transit connectivity to downtown, propelling apartment demand throughout the West Colfax corridor. Here, multifamily cap rates generally sit in the mid-5 to upper-5 percent range, in line with the metro average. Denver is a good market for investors to procure a multifamily loan to purchase their next property.
2020 Denver Multifamily Market Forecast
The Denver National Multifamily Index Rank is at 20, up 1 place. Reduced deliveries help to tighten vacancy this year, improving Denver’s standing in the Index.
Employment in Denver is up 1.3%. The metro’s 2.6 percent unemployment rate will restrain hiring activity this year as Denver registers its lowest job creation since 2010 with the addition of 19,800 workers to payrolls.
Construction in Denver is expected to exceed 8,800 apartment units. Completions will match the previous five-year average as builders remain focused on the urban core.
Vacancy in Denver is down 10 bps. Building on 60- and 70-basis-point drops during the previous two years, vacancy will contract to 4.4 percent in 2020.
Rent in Denver is up 4.5%. Denver’s average effective rent will climb to $1,625 this year as rent growth exceeds 4 percent for the third year in a row. In 2019, rents expanded by 6.0 percent.
Investment in Denver remains strong for those looking for apartment loans. Yields up to 150 basis points above other tech-heavy metros will continue to entice buyers nationwide, strengthening bidding environments and keeping price appreciation elevated. We advise investors looking in the Denver market to finance their next property with a multifamily loan.
Data provided by Marcus & Millichap.
Commercial Mortgage Rate Trends in 2020
At the beginning of 2020 the overall market outlook did not suggest any crucial factors that would negatively impact the commercial mortgage market. Commercial mortgage lenders and investors expected a very profitable 2020. Almost 65 percent of the top commercial real estate companies believed that commercial mortgage loan originations would go up this year and over 15 percent anticipated an overall rise of over 5 percent. Data released at the beginning of 2020 indicated that commercial mortgage lenders were expected to close over $680 billion of commercial mortgage loans this year. Experts were of the belief that commercial mortgage lenders would remain bullish about making loans. In addition, as commercial mortgages rates were expected to go down most industry leaders were convinced that borrowers in 2020 will have a strong desire to take out commercial mortgage loans. However, with the recent outbreak of the Covid-19 pandemic, the US and global economy has been incredibly unstable. The stock market seems to be bottoming out and commercial mortgage rates have been hit very hard. While the Fed has dropped short term interest rates, long term commercial mortgage rates have actually been rising. Huge cities like New York are shutting down. In this economic climate, many investors are scared to purchase commercial real estate and to take out commercial mortgages. Additionally, the oil industry has been hit hard. Not only are people traveling less due to coronavirus, China and Russia are currently involved in a price war which is driving the price of oil way down. Many people are optimistic that as spring and summer roll in and public health officials learns how to handle this pandemic, the economy should regain its strength.
What Happened with Commercial Mortgage Rates in 2019
As we review the 2019 year, the commercial real estate market continued to flourish as the longest economic recovery in American history continued. Due to both GDP growth and a steady decline in the unemployment rate, 2019 saw the stock market make huge gains. Many investors thought that commercial mortgage rates would go up last year. However, in actuality commercial mortgage rates actually went down three times. These interest rates helped to spur investors to put more money into commercial real estate. With regards to commercial mortgage loan origination, the 2019 fiscal year far exceeded expectations due to solid fundamentals, low interest rates and higher demand for commercial mortgages. While 2018 commercial mortgage volume totaled about $339 billion, an increase of 18.9% from 2017, the 2019 numbers total about $369 billion. On a larger scale, the 2019 economy prospered overall. Over the course of the year about 2.1 million jobs were added to the market. In addition, the unemployment rate decreased about 50 basis points last year, matching the lowest unemployment rate in fifty years. At the beginning of 2019 many investors were expecting a recession. However, the economy improved as job growth rose and the unemployment rate decreased. This economic improvement had an immensely positive impact on the commercial real estate market as more investors rushed to put their money into commercial properties.
Denver Commercial Mortgage Loan Options
Our staff is professional and knowledgeable, and we look forward to working with you on your next commercial mortgage transaction. We arrange financing in the city of Denver for the following:
- Multifamily Building Loans – we actively lend on garden apartments, high-rise multifamily buildings, student housing complexes, underlying cooperatives, and all other types of residential dwellings. We consider loan requests up to 80% LTV. We offer loans with and without recourse (personal guarantees) and with and without prepayment penalties. We offer fixed rate loans with terms from 3 to 30 years.
- Office Building Loans – we lend on all types of office properties, including multi-tenant and single tenant buildings in all locations. We lend on both owner occupied and investor properties. We typically lend up to 75% LTV on investor properties and up to 90% on owner occupied properties. Most loans are written for either 5, 7, or 10 years at a fixed rate with a 25-year amortization.
- Retail Building Loans – we gladly consider requests for commercial mortgage loans on shopping centers, retail strip centers, and individual retail stores. We are a little bit more conservative on retail loans these days based on the current climate for retailers and will consider LTV ratios of 65%-75% depending on the deal. We actively lend on NNN single tenant retail locations such as Starbuck’s, CVS, Walgreens, Dollar General, and other national credit rated tenants.
- Industrial Property Loans – we love to lend on warehouses, distribution centers, manufacturing facilities and other industrial properties. Often, these properties are owner occupied by the owner’s business. We also lend on multi-tenant industrial properties as well. We look for properties in good locations with access to population centers and transportation.
- Single/Special Use Loans – we have a special lending division that understands small business lending secured by owner occupied businesses such as motels, gas stations, restaurants, car washes, retail stores, and other specialty properties. Many banks have a hard time with this type of lending as they often do not understand the underlying businesses.
- Investment Property Loans – any and all income producing property will be considered. We are cash flow driven lenders and look for properties that generate positive cash flow for their owners. We will consider portfolios of single family residences under this group.
- Bridge Loans – many borrowers do not qualify for regular institutional financing due to various short-term obstacles which need to be resolved before they can qualify for bank type financing. These borrowers often require short term loans, or bridge loans, to overcome these short-term problems.
Denver Commercial Mortgage Loans
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