Buying Commercial: What the Loan Terms Say

Commercial Property · 2026-10-01

If you are weighing a commercial purchase, the financing terms deserve as much attention as the price. A recent article from Stacked Homes on commercial property loans gives a useful outline, and these are the points a buyer is most likely to need.

1. There is no standard LTV cap. Commercial and industrial loans are not bound by one standardised cap. Ratios in the article run between 70% and 90%, so the amount a bank will lend can differ a lot from one buyer to the next.
2. Who you are matters. Owner-occupiers with strong liquidity and cash flow can reach the upper end of that range, while investors are typically lower. Banks also assess the borrower and the relationship, not just the building.
3. Rates sit above home loans. Commercial rates are typically around 0.5% higher than residential benchmarks. The article cites recent commercial quotes starting at about 1.55% to 1.65%, with some banks higher, and one adviser expects roughly 2% by year-end. Those figures can change.
4. Repricing is possible. The article gives an example of a client who repriced an existing loan from 2.25% to 1.8%. Buyers who borrow today can ask about repricing options down the line.
5. No ABSD on commercial. Buying commercial or industrial property does not trigger Additional Buyer's Stamp Duty or an LTV cap tied to how many properties you own, which sets it apart from residential purchases.

Cecil Place is a freehold 15-storey commercial building at 137 Cecil Street, developed by Cecil Pte. Ltd. It offers 30 strata units of roughly 1,750 to 3,900 sqft across office, retail and F&B uses, and it is targeting BCA Green Mark Platinum or GoldPLUS. Telok Ayer MRT is about four minutes away on foot and Tanjong Pagar MRT about six, in the CBD Growth Corridor.

For an owner-occupier, a strata unit of this size range can suit a growing team, while for an investor the questions turn to tenancy and turnover. The location page shows the surrounding transport links, which are one of the first things prospective tenants check.

Whatever the purpose, a buyer should compare quotes from several lenders, ask how the bank views the tenancy or the business behind the purchase, and run the numbers at a higher rate than today's. Terms vary and change, and the article's figures are a snapshot.

Putting the five points together, a buyer is better served by gathering quotes from more than one bank than by accepting the first offer. It helps to bring evidence of liquidity and a clear plan for how the unit will be used or let. A stress test is worthwhile too: if the rate rose by half a percentage point, would the repayments still sit comfortably within the budget? Answering that before signing is far easier than answering it afterwards.

General information only, not financial or legal advice.

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Source: Stacked Homes. This article is independent commentary; CECIL PLACE is not affiliated with the parties mentioned.