April 21, 2026 Industrial & Logistics

What Goes Into a Cold Storage Facility Commercial Mortgage

Buying the cold storage facility your business runs from is a defining step for any cold chain operator. At Ardent Capital Group we specialise in commercial property finance for temperature-controlled premises, so this guide sets out how a lender values a cold store, what deposit to expect, and how the finance is commonly structured.

Ardent Capital Group is a specialist in commercial mortgages for cold storage facility operators across Australia. Our team can help you move from tenant to owner, and give you clear lending advice on structure and strategy.

Funding scope: We arrange finance from $100,000 to $10,000,000+, matched to your purchase price, fit-out and working capital needs.
Track record: We have helped facilitate over $500,000,000 in funding over a decade for more than 1,000 borrowers.
National service: Sydney, Melbourne, Brisbane, Perth, Adelaide, Canberra, Hobart and surrounding regional centres.
Lender access: Major banks and non-banks, with structures calibrated for owner-occupiers and specialised property.

Reasons to own your premises

Control of the box matters. Freezer slabs with underfloor heating, insulated panel rooms, vapour barriers, racking, high-capacity power, rapid doors, ammonia or CO2 plant, dock levellers and material handling equipment create a sunk cost profile that is hard to shift. Location anchors your client contracts and linehaul routes, especially near ports, food markets, intermodal hubs and key highway junctions. The sector serves food, pharma and seafood supply chains with resilient demand and long customer tenures. Mortgage repayments build ownership in an asset that holds the value of your improvements and the land.

Main drivers:

Fit-out retention: Own the facility so the value of panels, floors and plant sits under your title, not your landlord's.
Power and throughput control: Secure capacity upgrades, solar PV and backup generation without landlord friction.
Cost predictability: Set a related-party rent that aligns with your cash flow and tax position, within market parameters.
Growth flexibility: Reconfigure temperature zones, add docks or extend pallet positions on your timetable.

Buying may not suit when lease tenure is short, a relocation is planned to a different freight node, or capital is better deployed into automation, fleet, a new customer contract or product line. Treat the decision as a trade-off across cash flow, risk and strategic fit.

How the finance works for a cold storage facility

Deposit and LVR: A cold storage facility is standard commercial security, valued on comparable sales and achievable rent, so owner-occupiers can gear up to 80 per cent, which means a deposit from around 20 per cent. With additional property as security, some buyers borrow up to 100 per cent of the purchase price. The major banks publish no owner-occupier commercial LVR at all, which is where a broker earns their place.
Loan term and structure: Non-banks commonly run 25 to 30 years and the banks commonly publish 10 to 15. Principal and interest suits long-term ownership and equity build. Interest only can support cash flow during upgrades or commissioning phases, then switch to principal and interest.
Security and serviceability: The property is the primary security, including the fixed elements built into it, such as the insulated panel and in-slab refrigeration, which support the valuation. Truckable equipment, such as blast freezers, condensers, racking and forklifts, is a chattel funded on its own facility. Lenders assess business financials, earnings quality, existing rent transitioning to related-party rent, and interest cover.
Owner-occupier treatment: Lenders generally view owner-occupier purchases favourably due to alignment of cash flow and asset use, stable occupancy, and lower vacancy risk.

How the purchase is usually structured

Many cold storage operators hold the facility in a separate entity, such as a company or trust, and lease it to the trading business at a commercial rent. A lender then reads that inter-entity rent as the serviceability line, and the arrangement lets the mortgage and equipment facilities sit on separate securities. This is a common set-up a lender sees, not a direction on how the asset must be held.

An SMSF is another route some owners use. Commercial premises generally qualify as business real property, so a fund can own the building and lease it to your operating company at market rate, with borrowing arranged through a limited recourse arrangement and a bare (custodian) trust holding title. It carries borrowing limits, liquidity management, contribution caps and strict compliance rules. Ardent structures and places the loan, and the tax, ownership and any superannuation detail is confirmed by your accountant and SMSF specialist before settlement.

What underwriters focus on

Business financials: Profitability trends, seasonal patterns, customer concentration, contract terms and margins by temperature zone.
Serviceability: Cash flow coverage for mortgage and equipment finance, with sensitivity to power costs and demand charges.
Property and valuation: Land, building quality, freezer slab condition, panel fire compliance, dock configuration, clear heights and expansion scope.
Fit-out and plant: Refrigeration system type and age, maintenance records, redundancy, backup generation and expected remaining life.
Power and infrastructure: Incoming supply capacity, recent upgrades, solar potential, metering and connection constraints with the local network.
Environmental and compliance: Ammonia or CO2 safety systems, hazardous substance registers as applicable, HACCP or equivalent certifications, drainage and hygiene.
Deposit and equity position: Cash, available equity in other property, and capacity to fund capex without stressing working capital.
Lease and occupancy: For investors, covenant strength and WALE. For owner-occupiers, the related-party lease and market-rent support.

Cold storage facilities carry specialised fit-out, but the building itself is standard commercial security. A sector specialist broker helps align valuation, mortgage and equipment structures so the total package fits your operation.

A worked example

This is an illustrative scenario that shows the kind of situation we can assist with, and how the thinking might run.

Situation: Melbourne's west, 2,800 sqm freezer and chiller cross-dock with 8 docks and -25 to +2 degree zones. Paying $720,000 per annum in rent. Target purchase price $8,800,000, plus $1,400,000 for plant refresh, rapid doors and slab remediation.
Options weighed: A first mortgage on the real property up to 80 per cent, with a cash deposit for the balance, and equipment finance for the truckable plant to preserve cash. An alternate path using a second property to leverage your equity and reduce the cash deposit. Vendor terms considered for a deferred 10 per cent at a fixed coupon upon settlement.
Structures considered: Property trust owning the facility with a market lease to the trading company. Interest only for 24 months during upgrades, then principal and interest. Split facility with a construction or capex tranche tied to milestones.
Indicative lending: Up to 80 per cent on the real property subject to valuation and earnings, plus 5 to 7 year equipment facilities for refrigeration plant, racking and material handling equipment.
How we would approach it: We would map the ranges, structures and lender responses so you can weigh risk appetite, timing and cash flow priorities. The figures above are illustrative, not confirmed outcomes.

Beyond the mortgage: cold storage facility finance

These options can run alongside the property loan, from cold storage equipment finance for refrigeration plant through to working capital for a cold store to carry peak intake.

Asset finance: Blast freezers, ammonia or CO2 racks, condensers, insulated panel rooms, forklifts and reach trucks, dock levellers and pallet wrappers.
Fit-out and refurbishment finance: Freezer slab remediation with underfloor heating, vapour barriers, rapid roller doors, hygiene drainage and room reconfiguration.
Working capital loans: Seasonality support for intake peaks, energy bill smoothing through high summer or production spikes.
Business overdraft: Manage debtor cycles with major supermarkets and foodservice distributors on 30 to 60 day terms.
Refinancing and debt consolidation: Reset rates and terms, consolidate legacy equipment schedules, and free capacity against property.
Construction and renovation: Greenfield builds, extensions, power upgrades, and rooftop solar integrated with metering and export constraints.
Business or premises acquisition finance: Buy a competitor's facility or acquire a strategic site adjoining your current footprint.

These facilities can work together, for example owning the premises can free equity for plant upgrades, and a refinance can consolidate multiple schedules into a cleaner structure.

Working with a cold storage facility finance specialist

ACG arranges and structures finance around how you intend to hold and occupy the property, with clear planning for the mortgage, equipment finance and any capex tranche. We service Sydney, Melbourne, Brisbane, Gold Coast, Perth, Adelaide, Canberra and surrounding metro and regional areas. We have helped facilitate over $500,000,000 in funding over a decade for more than 1,000 borrowers. Ardent Capital Group is a specialist in commercial mortgages and our team can help you today. Talk to us about a clear path to optimal financial outcomes, without pressure.

We arrange each cold storage property loan end to end, from lender selection through to settlement.

Common questions

What deposit do I need to buy a cold storage facility as an owner-occupier? A cold storage facility is standard commercial security, so owner-occupiers can gear up to 80 per cent, which means a deposit from around 20 per cent. You can reduce the cash component by financing the truckable plant separately or by adding other property as security.

How do valuers treat refrigeration plant and insulated panels in the mortgage valuation? The fixed elements, such as insulated panel and in-slab refrigeration, are built into the building and support the real property value. Truckable plant and racking are chattels with their own facility, so we commonly split funding between the mortgage and equipment finance.

Can I use my SMSF to own the facility and lease it to my operating company? Commercial premises generally qualify as business real property, so an SMSF can own the building and lease it back at market rent under the correct structure. Borrowing occurs via a limited recourse arrangement, with contribution, liquidity and compliance constraints.

Can power upgrades, solar and backup generation be funded with the purchase? Yes, lenders can support a capex tranche within the mortgage or separate equipment facilities for transformers, switchboards, rooftop solar and generators, subject to valuation, cash flow coverage and milestone evidence.

Is interest only available for a period while we refurbish or commission new plant? Yes, many lenders will allow a defined interest only period to preserve cash flow during upgrades, then switch to principal and interest across the remaining term.

How do lenders view ammonia or CO2 systems from a risk perspective? They review compliance certificates, maintenance logs, safety systems, insurance cover and decommissioning plans. Specialised plant and higher compliance requirements can tighten terms, with stronger comfort for owner-occupiers with documented controls.

Is Lenders Mortgage Insurance a factor in commercial loans? Commercial mortgages generally do not use Lenders Mortgage Insurance. Pricing and covenants reflect the risk within the loan structure and security position.

Written by

Nick Chong

Managing Director, M.AppFin, Dip. Mortgage Mgmt

Nick holds a Bachelor of Agricultural Economics, a Master of Applied Finance and an Advanced Diploma in Financial Planning. He founded Ardent Capital in 2016 after more than a decade in financial planning and mortgage broking. For the past ten years he has led a team of finance specialists, mortgage advisers, brokers and credit analysts, all working to secure optimal outcomes for clients and always acting in their best interests. The team brings both a qualitative and a quantitative approach to every deal.