Permanent Financing for Commercial Real Estate: A Case Study
Our team recently arranged permanent financing for commercial real estate, specifically a $2,925,000 loan for a newly renovated office building in Las Vegas, NV. This transaction is a prime example of a successful “fix-and-flip” strategy in the commercial world, where a borrower uses short-term, high-interest financing to acquire and improve a property before securing a long-term, more favorable loan.
From Private Money to Permanent Financing
The borrower initially used private money to acquire and renovate the building. While private loans offer speed and flexibility, their higher interest rates make them unsustainable for long-term ownership. Once the renovation was complete and the property’s value increased, our team was able to arrange a long-term permanent financing for commercial real estate with a credit union. This new loan allowed the borrower to recapitalize their investment, pay off the private loan, and secure a stable, long-term financing solution.
Why Permanent Financing is Crucial
Securing permanent financing is the final and most critical step for many commercial real estate investors. It provides stability, predictable payments, and lower interest rates, allowing the investor to hold the asset for an extended period and generate consistent cash flow. This deal marks our seventh transaction with the same borrower, a testament to the value we provide in guiding our clients through every stage of their investment journey, from acquisition to long-term ownership.
About Us:
Nelson Funding is a nationwide commercial loan broker and direct lender helping borrowers get the best possible financing for their respective projects. Nelson Funding has provided financing for over 80 projects and placed more than $600mm of capital. Nelson Funding has the experience to get almost any project funded: from new construction to cash-out refinances, land development, and more. Nelson Funding specializes in construction funding, bridge funding, and conventional term financing products.
Nelson Funding remains committed to helping our clients secure the best financing for their respective commercial real estate projects despite a rising interest rate environment and tightening lending standards. With Nelson Funding’s capital market relationships and highly experienced team we are still placing high leverage debt for all deal types including land development, single family construction, multifamily construction, industrial, office, retail, hospitality, special-use, cannabis and more.
