San Francisco Commercial Mortgages
At Select Commercial, we pride ourselves on 35+ years of experience helping clients in San Francisco with their commercial mortgage needs. Our commitment to excellence has helped create our reputation as a top-tier broker in the area. If you're specifically interested in a San Francisco multifamily loan, we have dedicated resources to guide you. For those seeking comprehensive rates on all loan products available across the 48 states, our comprehensive commercial mortgage rate page offers competitive rates for loans starting at $1,500,000. Discover the latest trends in San Francisco commercial mortgage rates as we approach the close of 2024.
San Francisco Commercial Mortgage Rates - updated 11/21/24
| Minimum Loan Size $1,500,000 | Get Free Quote | ||
|---|---|---|---|
| Loan Product | Rate* | LTV | |
| Multifamily | 5.51% | Up to 80% | |
| Commercial Real Estate Loan | 6.92% | Up to 75% | |
| Single Tenant Lease | 6.62% | Up to 75% | |
| Business Real Estate Loan | 6.72% | Up to 90% | |
San Francisco Commercial Mortgage Benefits
CA commercial mortgage rates start as low as 5.51% (as of November 21st, 2024)
• A commercial mortgage broker with over 30 years of lending experience
• No upfront application or processing fees
• Simplified application process
• Up to 80% LTV on multi family , 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
Our Reviews
Some commercial mortgage lenders lock rates at application, some lenders lock rates at commitment, while others lock rates prior to closing. We are currently in the midst of an increasing rate environment. Rates quoted at application may increase dramatically during the loan application progress, if not locked. It is very important to understand your lender’s procedure upfront to avoid potential confusion.
In order for a commercial mortgage lender to issue a firm loan approval, they will want to understand the financial condition of the borrower, as well as the fundamentals of the property. The borrower will be expected to supply his personal financial statement showing total net worth and liquidity. He will also need to provide a schedule of real estate owned demonstrating experience managing similar properties. Lastly, the borrower’s credit scores will needed. For the subject property, lenders will look closely at the current rent roll, operating statements showing income and expenses, copies of all leases, and other pertinent property information.
Commercial mortgage rates are determined by many different factors, including property type, location of the property, loan-to-value ratio, debt service coverage ratio, debt yield, borrower’s net worth, liquidity, credit rating and level of experience. Commercial mortgage lenders look at all of these factors to determine the riskiness of the loan before setting rates. Loans with the lowest risk profile will get the best commercial mortgage rates. As the potential risk increases, commercial mortgage rates usually increase.
Commercial mortgage loans are viewed differently by lenders than residential loans. Home loan lenders look strictly at the borrower’s income and credit in order to qualify. Commercial mortgage lenders look at the subject property’s rent roll, operating statements, and other factors to determine the cash flow or net income potential. Very strong (low risk) commercial mortgage loans might be priced lower than home loans, while weaker performing properties (higher risk) might be priced higher.
Most commercial mortgage loans today are fixed for 5, 7, or 10 years and come with a 25-30 year amortization schedule. Loans can be recourse (personal guarantee) or non-recourse (no personal guarantee). Commercial mortgage loans typically carry prepayment penalties, whereas residential home loans usually do not. Specific terms will be determined by your lender’s underwriting team after your application is reviewed.
Commercial mortgage lenders typically lend up to 75-80% on an apartment purchase (down payment of 20-25% necessary). On other types of commercial property, commercial mortgage lenders will typically lend up to 70-75% (down payment of 25-30% necessary). An exception is for owner occupied business real estate (such as a business owner buying his own property). Owner/users may qualify for up to 90% LTV financing.
Select Commercial is a leading commercial real estate loan provider. We have excellent commercial real estate loan products and options available for owners and purchasers of commercial real estate. While we lend across the entire continental United States, we are able to give our best commercial mortgage rates and loan programs to certain areas that we feel are strong markets. San Francisco 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. As an experienced commercial mortgage professional, with over 30 years of lending experience, we have many sources of capital to choose from when placing a commercial mortgage request with a lender. Having many lenders to choose from gives us advantages over any one individual source. Finding the lender that fits the needs of each client is what we do best. In the end, you get the best rate and terms available. If you are looking to obtain a 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.
Commercial Real Estate Recent Closings
What’s going on with commercial mortgage rates in San Francisco as we near the end of 2024?
The Federal Reserve’s Federal Open Markets Committee cut the federal funds rate by 50 basis points at its September 18, 2024, meeting. This was the first rate cut since March 2020, when the Fed began a long series of rate hikes to curb the high rate of inflation. The Fed’s decision shows that they believe that inflation is under control and moving into the 2% range that the Fed has set as its goal. The Federal Reserve took this decisive action to prevent further declines in the labor market. The Fed has further hinted at further cuts at its two remaining meetings in 2024, followed by additional cuts in 2025. This rate cut, along with possible future rate cuts, may create positive investor demand for commercial real estate, and may provide aid for commercial mortgage customers, as well as consumers in general. We must caution, however, that the Federal Reserve cuts affect short term interest rates directly and long-term rates only indirectly. The Prime Rate, which is a short-term rate, dropped from 8.50% to 8.00% with the Fed’s recent action. However, most commercial mortgage rates are based on the 5-, 7-, or 10-year treasury rates, and not the Prime Rate. We have seen these treasury rates actually rise since the Fed took its action. On September 18th, the 10-year treasury was roughly 3.70%. Three weeks later, this rate had jumped to 4.03%. Investors are still concerned about future inflation and are adopting a wait and see attitude.
San Francisco Office Commercial Real Estate Insights: Q3 2023
San Francisco, a global hub for technology and innovation, continues to be a focal point for businesses seeking prime office real estate. The city's office spaces are not only adapting to the latest technological trends but also ensuring they cater to the diverse needs of modern enterprises.
Office Market Overview:
With the rise of remote working and hybrid models, there is a consistent demand for flexible office spaces in San Francisco. The city, known for its tech-driven ecosystem, is witnessing a shift in office designs that promote collaboration, innovation, and adaptability.
Future of Office Spaces:
San Francisco's strategic position in the tech industry ensures its office real estate market remains resilient and forward-looking. As businesses evolve, the city's office spaces are expected to integrate more tech solutions, promoting efficiency and sustainability.
San Francisco Industrial Commercial Real Estate Insights: Q3 2023
San Francisco, given its proximity to major ports and transportation hubs, plays a crucial role in the industrial sector. The city's industrial spaces are gearing up to accommodate the rising demands of e-commerce and logistics businesses.
Industrial Market Overview:
With the surge in e-commerce and the need for efficient logistics solutions, San Francisco is witnessing a demand for state-of-the-art industrial facilities. These spaces are equipped with the latest technologies to ensure seamless operations.
Emerging Industrial Trends:
The rise of electric vehicles and sustainable solutions is influencing the industrial real estate market in San Francisco. The city is at the forefront of these trends, ensuring its industrial spaces are future-ready.
San Francisco Retail Commercial Real Estate Insights: Q3 2023
San Francisco, with its rich cultural heritage and diverse population, offers a dynamic retail landscape. From luxury boutiques to local artisans, the city's retail spaces are a blend of tradition and modernity.
Retail Market Overview:
Consumer behavior in San Francisco is ever-evolving. The city's retail sector is focusing on providing immersive shopping experiences, integrating technology, and promoting sustainable practices.
Future of Retail Spaces:
San Francisco is set to redefine retail experiences by integrating technology, sustainability, and local culture. The city aims to offer a unique blend of shopping experiences that resonate with both residents and tourists.
San Francisco Hotel Commercial Real Estate Insights: Q3 2023
San Francisco, known for its iconic landmarks and vibrant culture, attracts travelers from around the world. The city's hotels are focusing on enhancing guest experiences by integrating technology and promoting sustainability.
Hotel Market Overview:
San Francisco offers a diverse range of accommodations, from luxury resorts to boutique hotels. These establishments are focusing on providing personalized experiences, ensuring safety, and promoting eco-friendly practices.
Adapting to New Travel Norms:
In the wake of the pandemic, San Francisco's hotels are emphasizing safety, hygiene, and sustainability. The city's hospitality sector is adapting to new norms, ensuring guests have a memorable and safe stay.
What areas of San Francisco does Select Commercial provide financing?
Select Commercial provides commercial real estate loans throughout San Francisco including but not limited to the areas below.