CMBS Loans for Commercial Properties

A CMBS loan, also known as a conduit loan, is a type of commercial real estate loan that is secured by a first position mortgage on a commercial property. Commercial banks, investment banks, and conduit lenders usually offer CMBS loans to CRE investors looking for higher leverage and lower fixed interest rates.  CMBS loans are held in a separate trust serving as collateral for a mortgage-backed security.  These loans are non-recourse, have a fixed interest rate amortized over 25-30 years, and are offered to income producing properties.  CMBS loan amounts are from $2,000,000 and up with leverage up to 75%.  

CMBS loans are available for a variety of property types, including multifamily properties, apartment buildings and office buildings, as well as retail, industrial, and self-storage properties. 


General CMBS Loan terms 

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  • Loan Size: $2,000,000 and up
  • Loan Term: 5, 7, or 10 year fixed-rate loans 
  • Interest Rates: 4.9% (for 10 year fixed)
  • Amortization: 30 years 
  • Leverage: 75% Maximum LTV
  • DSCR: 1.25 Minimum 
  • Recourse: Non-recourse (with standard carve-outs)

CMBS LOAN CONS 

  • Difficulty releasing collateral 
  • Expensive to exit (long lock-out periods may require defeasance in order to exit loan early) 
  • Reserves required 
  • Secondary financing is often prohibited 

CMBS LOAN ProS

  • Non-recourse 
  • Competitive rates for long-term financing 
  • Flexible loan sizes 
  • Cash-out refinancing options available 

Want to learn more about CMBS loans? Fill out the form below and a CMBS loan specialist will get in touch. 

FILL OUT THE FORM BELOW TO SPEAK WITH A CMBS LOAN SPECIALIST

 
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