Illinois Commercial Mortgage Loans from $1,000,000+
Illinois Commercial Mortgage Rates - Rates updated April 4th, 2020
|Loan Product||Starting Rates||LTV|
|Single Tenant Lease Rates||3.55%||Up to 75%||Get Free Quote|
|Commercial Mortgage Rates||3.85%||Up to 75%||Get Free Quote|
|Multifamily Mortgage Rates||3.58%||Up to 80%||Get Free Quote|
|Business Real Estate Loans||3.65%||Up to 90%||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 state of Illinois. 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. Illinois is one of the states 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 IL borrowers looking to purchase or refinance a commercial property. If you are looking to obtain an 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. Our staff is professional and knowledgeable, and we look forward to working with you on your next commercial mortgage transaction.
Illinois Commercial Mortgage Benefits
Illinois commercial mortgage rates start as low as 3.58% (as of April 4th, 2020)
• 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!"
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.
Illinois Commercial Mortgage Loan Options
We arrange commercial mortgage financing in the state of Illinois for the following:
- Multifamily 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.
Illinois Commercial Mortgage Information and Economic Overview
The economy of Illinois is the fifth largest in the country with a gross state product of almost $860 billion and is one of the most diversified economies globally. Illinois has a median household income of around $60,000. The Chicago metropolitan area is home to many of the country’s largest companies, including Allstate, Boeing, McDonald’s and United Airlines.
Chicago Illinois real estate has been rated as one of the most undervalued and underrated commercial real estate markets in the country. Chicago is witnessing a building boom with over 60 cranes hovering atop new skyscrapers being built, creating an incredible amount of new business opportunities and positively impacting the market. There has never been a better time to look into commercial mortgage financing in the Chicago Illinois than right now! After the market flattened a bit last year, property rose by 5 percent in the first quarter of 2019 compared with the same period in 2018. Market research has actually shown that commercial property values were 2.5 percent higher than their pre-recession peak in 2007, leading investors to make big returns on their money.
The Illinois commercial real estate industry is being driven in part by a thriving industrial market. Due to strong economic development and a heavy demand for property geared towards internet businesses, industrial real estate vacancies are at their lowest in over 15 years! In particular, the marketplace is even tighter for investors looking for warehouse space. Even with heavy growth, commercial real estate developers are still meeting the pace of demand in Illinois. Commercial office spaces are also highly enticing investments in the current Illinois market. Office developers are pushing the boundaries of what the real estate market can handle. Even with so much new commercial office development vacancy rates in the Chicago area remain low at under 12 percent. Technology company hiring in the Chicago area is increasing demand for office space.
The multifamily and apartment sector is another great place obtain commercial mortgage financing in order to invest in Chicago commercial real estate. This year, the annual delivery volumes in Chicago reached a two-decade high with a new supply of almost 10,300 new multifamily units. Recent apartment deliveries have made up for a few years of diminishing supply volumes, ranking Chicago as one of the nation’s leaders for apartment completions since 2010. Almost 54,000 units have been completed in Chicago since the beginning of 2010, ranking the market in the #10 spot nationally for total cycle supply. The Chicago multifamily market may see slight declines over the next year in the pace of new construction and rent increases. A report by Marcus and Millichap forecasts average rent growth of just over 3% this year in the Chicago metropolitan area which is about half the rate of rent growth in 2018. It also projects that 7,800 new multifamily units will be built this year, down from the past two years. The combination of those factors should mean that apartment vacancy rates will remain relatively unchanged at a region-wide average of 5.3% making now a great time to purchase apartment and multifamily buildings. With regards to commercial mortgages, there are currently over 3.2 million mortgages for commercial real estate properties throughout the state of Illinois. The average value of these commercial mortgages is over $5.6 million, 7% above the United States average. This data demonstrates that Illinois is a very attractive place to attain a commercial mortgage loan.