Retail

Standard financing

Properties with stable cash flow and consistent operating histories are favourable candidates for standard financing. For retail assets, this can mean properties that are fully or nearly fully leased, have a majority of tenants on long-term leases and can display a consistent history of strong tenancy.

Standard financing offers a term of five years or more, a fixed interest rate and is typically closed to prepayment for the term’s duration.

Standard financing is usually considered when borrowers want the payment predictability that comes with a fixed interest rate. However, it is important to note that a typical conventional financing term for a retail plaza is five years. Longer terms are available, but there is often greater scrutiny on future cash flows. Borrowers must be able to show that longer-term leases (i.e. maturing in 10 years or more) are in place for the duration of the mortgage term.

Commercial Mortgage Backed Securities (CMBS): CMBS is a conventional financing solution available for first mortgages on established, stabilized properties (generally three or more years of stable operating history). This type of financing works well for properties with in-place, stabilized net cash flow.

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Economic and political developments – both in Canada and globally – can impact the commercial real estate market. First National experts follow these trends closely and provide honest, real and professional perspectives into what they could mean for your portfolio.

Smart risk solutions in action for retail

See how we’ve applied our financing products innovatively to help retail borrowers achieve their goals with performance and value.

To refinance the property and obtain equity capital for renovation business

$11.7 Million
165,528 sq. ft.
Barrie, Ontario

Loan financing
7 years term, 25 years amortization
LTV: 70%

Seeking a term loan to provide capital for the purchase of retail property

$6.8 Million
19,656 sq. ft.
London, Ontario

Conventional loan
5 years term, 25 years amortization
LTV: 60.0%

To refinance the current loan on the subject properties

$4.6 Million
57,574 sq. ft.
Woodstock/Orangeville, Ontario

Refinance
5 years term, 20 years amortization
LTV: 70%

Construction financing for the development of urban retail

$9 million
84,530 sq ft
Oakville, Ontario

Conventional construction advance
3 years term, 8 years amortization
LTV: 75%

Liberate existing debt against property to finance continued improvements on subject property

$6 million
32,542 sq ft
Milton, Ontario

CMHC refinancing first mortgage
Conventional mortgage extension
3 months term, interest only

Construction financing for the development of commercial space on subject property

$5 million
49,120 sq ft
Kitchener, Ontario

Conventional loan extension
1 year term, 8 years amortization
LTV: 65%

Provide funds required to re-lease the site and invest in further additions to subject property

$7 million
42,440 sq ft
North York, Ontario

Conventional bridge renewal
1 year term, 3 years amortization
LTV: 70%

Bridge loan used to release the closing grocery store on the property

$2 million
45,529 sq. ft.
Calgary, Alberta

Conventional bridge loan
2 years term, interest only amortization
LTV: 70%

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Latest resources and insights

Original perspectives and personal viewpoints on developments and industry trends in commercial real estate.

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View other retail mortgage solutions

Bridge financing

First National’s bridge loan terms usually range from three months to three years, include floating interest rates and allow some form of early prepayment. Borrowers choose this solution until standard financing is secured or while they contemplate a property sale, a change in ownership structure or enhance their tenant roster.

Asset repositioning

First National enables owners to access a property’s equity for a short term, typically two years or less, to fund capital improvements or repairs without the need to raise capital from personal sources or less flexible, higher-cost alternatives.

Secondary financing

A First National second mortgage enables borrowers to liberate property equity and use it to purchase another asset or renovate/repair an existing property.

Construction financing

A First National construction loan provides funds to cover the cost of building or rehabilitating a retail property with terms typically of three years or less.

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