28 June 2026 Featured Guides

Commercial Property Loan Options: Banks, Non-Banks, Private Lenders and More

Banks, non-bank lenders, private lenders, SMSF borrowing and vendor finance can all fund a commercial property purchase. This guide explains how each one assesses a borrower and a property, what it typically offers, and where it fits, from the team at Ardent Capital Group.

Six sources of finance can fund a commercial property purchase in Australia: the major banks, regional banks and mutuals, non-bank lenders, private lenders, a self-managed super fund borrowing arrangement, and the vendor. Each one assesses the borrower and the property differently, and each suits a different situation. This guide sets out how they work, side by side.

Commercial property loans from the major banks

The four major banks lend on owner-occupied and investment commercial property, and for a borrower who fits their policy they generally offer the lowest interest rates in the market. In return they ask for the most documentation and apply the most conservative assessment.

Documentation: full financials, commonly two years of business financial statements and tax returns, plus personal tax returns for the directors.
Loan-to-value ratio (LVR): the majors do not publish an owner-occupier commercial LVR. Each deal is assessed case by case. One major bank publishes a lease-doc maximum of 65%, where the loan is assessed on the rent the property earns.
Loan term: commonly 10 to 15 years, often shorter than the term a non-bank offers.
Reviews and covenants: many bank commercial loans carry an annual review and financial covenants, such as a minimum interest cover ratio, that the business must keep meeting.
Property types: offices, shops, warehouses and factories sit comfortably within bank policy. Specialised property, such as a pub, motel or childcare centre, is assessed more cautiously and at lower LVRs.

Regional banks, credit unions and mutual banks

Below the majors sits a group of regional banks and customer-owned banking institutions, the credit unions and mutual banks. They are authorised deposit-taking institutions, regulated by APRA in the same way as the major banks, and many of them write commercial property loans.

Local knowledge: a regional bank can know a regional town and its property market well, which helps where a major bank's valuation policy treats a smaller market conservatively.
Loan size and appetite: commercial lending limits and the property types accepted vary widely between these lenders. Some focus on smaller commercial loans; others lend on larger commercial property.
Assessment: documentation is generally full-doc, similar to the majors, and pricing is set by each lender.

Non-bank commercial property lenders

A non-bank lender is not a deposit-taking institution. It funds its loans from wholesale markets, securitisation and private investors, and it sets its own credit policy. Non-banks cover much of the commercial lending that falls outside bank policy, and their loans are priced above bank rates to reflect that.

LVR: non-bank lenders publish maximums of up to 80% on standard commercial property, such as offices, shops, warehouses and factories.
Loan term: commonly 25 to 30 years, which lowers the repayment compared with a 10 to 15 year bank term on the same loan amount.
Documentation options: full-doc, low-doc and lease-doc loans. On a lease-doc loan the lender assesses the rent rather than the borrower's full financials, and the maximum is commonly 65% to 75%, tiered by loan size.
Who they suit: self-employed borrowers with less documentation, recent business changes, specialised property, and borrowers who want a longer term without an annual review.

Across these lender groups, the same property can gear very differently depending on where the application goes. Commercial property loans are assessed on the security, the documentation type and the loan size, and each lender draws those lines in a different place.

Private finance for commercial property

Private lenders lend their own capital, or capital from a private credit fund, against property. They lend on short terms, commonly one to twelve months, and assess the deal mainly on the value of the property and the borrower's plan to repay. They can approve and settle in days rather than weeks.

First mortgage: the private lender holds the only mortgage over the property.
Second mortgage: the private lender sits behind an existing first mortgage, which usually needs the first lender's consent.
Caveat loan: the lender lodges a caveat over the title rather than registering a mortgage, which is faster to put in place.

Private finance suits time-critical situations: settling a purchase to a contract deadline, bridging between a purchase and a sale, or funding a deal while longer-term finance is arranged. Borrowers who need funds within days often turn to urgent private finance lenders such as Secured Lending, which lend against residential, commercial and industrial property on short terms.

Two points decide whether private finance works. The first is cost: interest rates and fees are higher than bank and non-bank lending, so the full cost over the expected term needs to be calculated before you commit. The second is the exit: the lender needs a clear plan for repaying the loan, usually a refinance to a bank or non-bank, or the sale of a property. Our urgent and bridging finance page explains how those short-term loans are assessed.

SMSF loans for commercial property

A self-managed super fund can borrow to buy commercial property through a limited recourse borrowing arrangement. The rules are specific, and the detail is what decides whether it works.

From 10 August 2026, a new limited recourse borrowing arrangement over real property must be over business real property.
The property is held in a separate holding trust, and the lender's recourse is limited to that one property.
Where a related business leases the property, the lease must be in writing, at market rent supported by an independent appraisal, and the rent must be paid.
The loan funds a single asset. The business, goodwill, fit-out and equipment are financed separately, outside the fund.
Cross-collateralisation is not available inside super, so the fund needs its own deposit.
The borrowing cannot fund a cash out, an equity release or an improvement to the property.
The major banks exited SMSF lending between 2015 and 2019. Specialist and non-bank lenders now write these loans, with maximum LVRs commonly 65% to 80% on standard commercial property.
The holding trust must exist before contracts are signed, and the order of signing differs between states.

Our SMSF commercial property loan page covers the lending side in more detail. We arrange the finance, and bring in the SMSF specialists and licensed advisers who set up the fund side.

Vendor finance on a commercial property

Vendor finance is a loan from the seller for part of the purchase price. The buyer pays a deposit, a lender funds most of the balance, and the seller agrees to receive the remainder over time, with interest, secured by a second mortgage over the property.

Terms are negotiated: the amount, interest rate, term and repayments are agreed between buyer and seller and documented by their solicitors.
The first lender must agree: a vendor second mortgage sits behind the main loan, and some lenders do not accept one, so the lender's position needs to be confirmed before the contract is signed.
Where it appears: vendor finance is less common in commercial property than bank or non-bank lending. It appears where a seller wants to widen the pool of buyers, or where the property sits outside standard lending policy.

Comparing commercial property loan options

Major banks: lowest rates for borrowers within policy, full documentation, no published owner-occupier LVR, terms commonly 10 to 15 years.
Regional banks and mutuals: APRA-regulated like the majors, varied appetite and loan sizes, full documentation.
Non-bank lenders: up to 80% on standard commercial property, terms commonly 25 to 30 years, full-doc, low-doc and lease-doc options, priced above the banks.
Private lenders: short terms commonly one to twelve months, assessed on the property and the exit, settlement in days, the highest cost of the six.
SMSF lending: business real property only for a new arrangement, commonly 65% to 80% on standard commercial property, from specialist and non-bank lenders.
Vendor finance: part of the price lent by the seller, terms negotiated, behind a main lender that must agree to it.

Common questions

Which commercial property lender offers the lowest interest rate?

For a borrower with full financials buying standard commercial property, the major banks generally price lowest. The rate is only part of the cost. Loan term, fees, annual reviews and covenants also differ between lenders, and every rate is set by the lender and subject to approval.

Can I refinance from a private or non-bank loan to a bank later?

Yes. Many borrowers use a non-bank or private loan for a purchase, then refinance to a bank once their financials or the property meet bank policy. A private loan is usually arranged with that refinance planned as the exit from the start.

Do the major banks lend to SMSFs for commercial property?

No. The major banks exited SMSF lending between 2015 and 2019. SMSF commercial property loans now come from specialist and non-bank lenders.

Why do private lenders charge more than banks?

Private lenders fund loans from private capital, lend on short terms, accept situations outside bank and non-bank policy, and approve in days. Their rates and fees reflect that. The full cost over the expected term should be calculated before the loan is taken.

About this guide

Ardent Capital Group arranges commercial property finance across bank and non-bank lenders. If you are comparing these options for a purchase, our team can set out how each type of lender would assess your deal.

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.