Financing for smaller properties still readily available

While larger properties and portfolios remain difficult to finance, there is no shortage of financing for the smaller commercial properties priced under $10M. The reason behind this is that the credit freeze on Wall street has really only affected the larger loans that are sold to the secondary market through commercial mortgage backed securities (CMBS).

For the smaller loans, however, many second and third tier lenders such as local community banks, often hold onto the loans they originate rather than securitizing them through CMBS offerings. Buyers who intend to use property for their business are getting very favorable rates and usually get loan guarantees through the Small Business Administration (SBA).

This being said, there is still plenty of capital available through REITs, pension funds and foreign investors for the larger properties that are well positioned.