SMSF commercial property loans

Ardent Capital Group brings the same method to every client: execution and strategy, clear advice for smart lending, and long-term growth. That means the right lender, structure and timing, straight advice so you borrow with confidence, and today's deal built toward where you want to be tomorrow. We are specialists in helping business owners secure finance to purchase their own property, and we understand the complex structures that often sit around it, including multiple trusts, holding companies and self-managed super funds. Limited recourse borrowing leaves little room for error, so the structure and documentation have to be built correctly before the deal goes anywhere, and it goes to lenders who fund into this space and know how the arrangement must be set up. As the fund's holdings grow, the team stays alongside it well past settlement. Every figure is subject to serviceability, lender appetite and approval.

The law now requires that any new limited recourse borrowing arrangement over real property be over business real property, meaning property used wholly and exclusively in one or more businesses. In practice this ends new SMSF borrowing for residential property. Commercial property generally still qualifies, and the business does not have to be yours: premises leased to an unrelated business tenant meet the test. The traps are a property with no business use, such as vacant land held for growth, and mixed-use buildings such as a shop with a residential flat above it. Arrangements entered into before 10 August 2026 are unaffected, refinancing a pre-existing borrowing is unaffected, and if the contract was signed before that date the purchase is protected even if it settles afterwards.

Because the lender panel is small and getting smaller. The major banks have largely exited SMSF lending, so these loans sit with a short list of specialist and non-bank lenders, each with its own view on the property type, the lease, the fund balance and the liquidity it wants left behind after settlement. Going direct means one policy and one answer. We know which lenders are actually writing SMSF commercial this quarter and what each will want to see, and we present the fund, the trust structure and the lease in the form a credit team needs. Getting that wrong is how a perfectly fundable purchase gets declined.

It is a commercial loan made to a self-managed super fund under a limited recourse borrowing arrangement, so the fund can buy a commercial property. The property is held in a separate holding trust until the loan is repaid, and the lender's recourse is limited to that one property, so the fund's other assets are quarantined. Many business owners use it to buy the premises their own company occupies and lease it back to the business at market rent. Others hold commercial property in the fund as an investment leased to an unrelated tenant. The borrowing rules are strict and are set by superannuation law, not by the lender.

A limited recourse borrowing arrangement (LRBA) is the legal structure that allows an SMSF to borrow money to purchase an asset. Under the arrangement, the borrowed funds can only be used to purchase a single asset (or a collection of identical assets). The asset is held in a separate bare trust until the loan is fully repaid, at which point ownership transfers to the SMSF. The 'limited recourse' aspect means the lender can only claim against the single asset held in the bare trust if the loan defaults, not against other fund assets.

The test is not the property type, it is how the property is used. From 10 August 2026, a new limited recourse borrowing arrangement over real property can only be used where the property is business real property, meaning it is used wholly and exclusively in one or more businesses. Importantly, the business does not have to be yours: an office, shop, warehouse or consulting suite leased to an unrelated business tenant still qualifies. Offices, retail premises, industrial units, warehouses and medical or professional rooms are all routinely funded. Where it gets tight is a property with no business use at all, such as vacant land held for capital growth, or a mixed-use building like a shop with a residential flat above it, which fails the wholly and exclusively test.

Most SMSF commercial lending settles between 65% and 80% of the property value, and up to 90% with no LMI where a medical, dental or veterinary fund buys the practice's own rooms. What you are offered depends on the property, the lease behind it and the fund's serviceability, and these loans now come from specialist and non-bank lenders. Talk to us and we will map it to your fund.

The credit decision is rarely what sets the date. The structure is. The holding trust has to exist before contracts are signed, and the order is state-based: in Queensland and South Australia the bare trust deed is executed before the contract of sale, and in New South Wales, Victoria, Tasmania and the ACT it is executed after. The contract must be signed by the trustee of the bare trust, not by the SMSF trustee. Get the order or the name on the contract wrong and you can trigger double stamp duty, which is an expensive and avoidable mistake in an SMSF purchase. Conditional approval commonly runs two to four weeks, but plan the sequence before you make an offer. That is the part we get right for you.

Lenders want the fund's trust deed, confirming it permits borrowing under a limited recourse borrowing arrangement, the bare trust deed and the corporate trustee details, two years of fund financial statements and member statements, the contract of sale, the proposed lease if the property is going to a related business, and evidence of the fund's contribution history and liquidity after settlement. Where the fund's income relies on the members' business, the lender will also want that business's financials. We work through the list with your accountant so nothing surfaces late, because an incomplete file is the usual reason these deals stall.

Yes, and this is the most common reason funds buy commercial property. Where the property is business real property, the fund can lease it to a related business. The lease has to be in writing, on commercial terms, at a market rent supported by an independent appraisal, and the rent has to actually be paid on time and be evidenced. Rent set below or above market can be treated as non-arm's length income and taxed at the top marginal rate. This is one of the few places where superannuation law lets a fund and a related party deal with each other directly, which is exactly why it has to be documented properly.

A bare trustee is a separate entity, typically a company, that holds legal title to the property on behalf of the SMSF during the period the loan is outstanding. The bare trustee arrangement is required because superannuation legislation does not allow the SMSF itself to hold a mortgaged asset directly. Once the loan is fully repaid, legal title transfers from the bare trustee to the SMSF. Setting up the bare trustee correctly, with the right documentation, is one of the most common sources of delay in SMSF property purchases.

Yes, and it is common. The law allows borrowed money to be applied to refinance an existing complying borrowing, but only in relation to the same single property and no other. That means the refinance cannot exceed the balance outstanding plus accrued interest. There is no top-up, no cash out and no equity release, and you cannot roll two arrangements into one. A refinance is treated as a new arrangement that must satisfy the law in force when it happens, and where a new holding trust is used the property has to transfer directly to it. Refinancing a borrowing entered into before 10 August 2026 is not affected by the new business real property rule.

Most of the time, no. We are paid a commission by the lender once your loan settles. Where a purchase requires significant preparation, a small mandate fee may apply, and we will always be upfront about this before work begins.

Yes, and it is how these purchases get done. An SMSF purchase has more moving parts than a standard commercial one: your accountant and licensed adviser own the fund structure and the decision, your solicitor handles the bare trust deed and the contract, the auditor sees it afterwards, and we arrange the finance and hold the timeline together. We work to their structure and present it to the lender. We know this sounds complicated. It is, and that is exactly why we do it every day. Reach out to our team and we will guide you through the entire process. You will not be working it out on your own.

Although we are based in Sydney, we service clients across all major Australian cities, including Melbourne, Perth, Brisbane, the Gold Coast, Adelaide, Canberra and Hobart, along with their surrounding regional areas. Wherever the property your SMSF is buying is located, we can arrange your finance.

Although our main speciality is property loans for business owners, we also assist your operating business with equipment and vehicle finance and working capital for your business, held outside the fund. On asset finance, that covers equipment, machinery and commercial vehicles. On working capital, we arrange business overdrafts, lines of credit and cash-flow funding. We keep these facilities separate from your fund so the SMSF borrowing stays compliant.

Yes. That is our core ethos, helping you understand the right strategy, structure and clear advice from the very first conversation. Our main borrower profiles are established business owners and SMSF trustees seeking finance from $100,000 upwards for their company, so a first commercial loan is well within our wheelhouse. Smaller sole-trader and consumer-style ABN lending sits outside our field.