For many business owners, the biggest challenge isn’t managing their day-to-day operations—it’s accessing capital when it matters most. Whether you’re expanding your footprint, upgrading equipment, hiring staff, or simply stabilizing cash flow, having flexible financing options can be the difference between seizing an opportunity and watching it pass by.
One of the most underutilized tools available to business owners is the equity locked in their commercial real estate. A Commercial Real Estate (CRE) loan—or refinancing an existing CRE loan—can help you leverage that equity to access more capital at better terms.
This article breaks down how CRE loans work and why tapping into your property’s equity may be the most strategic financial move for your business this year.
Understanding Equity in Your Commercial Property
Equity is simply the difference between your property’s current market value and the amount you still owe on the loan.
For example:
If your building is worth $1,000,000
And you owe $500,000
You have $500,000 in equity
Many business owners don’t realize that this equity can be converted into working capital. In other words, your property can become a financial tool that fuels business growth.
How CRE Loans Unlock Capital
A CRE loan or refinance allows you to borrow against the equity in your property. Lenders typically allow 70 to 80 percent loan-to-value depending on the type of property, your business strength, and the loan structure.
Example: Turning Equity Into Growth Capital
If your building appraises at $1,000,000 and your lender allows a 75% loan-to-value:
75% loan-to-value = $750,000
Existing loan balance = $500,000
Available capital = $250,000
Businesses commonly use this capital to:
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Expand or renovate
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Purchase equipment
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Hire new staff
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Strengthen cash flow
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Improve marketing and customer acquisition
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Consolidate higher-interest debt
You continue to own your property, while unlocking the cash needed to take your business to the next level.
Why CRE Loans Are a Smart Strategy for Business Owners in 2025
1. Lower Interest Rates Compared to Unsecured Loans
Because the loan is backed by real property, CRE loans often offer significantly better rates than credit cards, unsecured loans, or lines of credit.
2. Longer Repayment Terms
Terms often range from 10 to 25 years, reducing monthly payments and improving cash flow.
3. Predictable Payments
Fixed-rate CRE loans offer stability, helping business owners plan long-term without worrying about rate volatility.
4. Potential Tax Advantages
Interest on CRE loans may be tax-deductible. Be sure to consult with a CPA for specific guidance.
5. Stronger Balance Sheet
Accessing equity and converting it into capital can improve your liquidity and position your business more favorably in future lending scenarios.
Refinancing Your CRE Loan: An Overlooked Opportunity
Many business owners never revisit their original commercial real estate loan—even though their property may have appreciated significantly.
Refinancing can allow you to:
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Reduce your interest rate
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Free up capital for growth
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Extend loan terms for lower monthly payments
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Consolidate business debt
In today’s economic environment, refinancing is often more about strategic growth than simple cost savings.
When Leveraging CRE Equity Makes Sense
A CRE loan may be ideal if:
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You need capital for expansion
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You want lower-rate, longer-term financing
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You prefer to avoid equity partners or investors
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Your property has increased in value
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You want to consolidate multiple debts into one manageable payment
If you’ve built equity, you may already have one of the most powerful funding tools available.
What to Expect During the Loan Process
1. Financial Review
Lenders will review your business financials, tax returns, rent rolls (if applicable), and other supporting documents.
2. Property Appraisal
A licensed appraisal determines your property’s value and available equity.
3. Underwriting
Lenders verify documentation, assess risk, and finalize loan terms.
4. Closing
Funds are disbursed, either as a lump sum or structured draws depending on the loan’s purpose.
A strong lending partner will guide you through each step with transparency and clear expectations.
Final Thoughts: Your Commercial Property Can Be a Gateway to Business Growth
If your business owns commercial real estate, you’re sitting on a powerful financial asset. A CRE loan doesn’t just help you buy or refinance property—it unlocks equity that can propel your business forward.
Capital shouldn’t be what holds your business back. Exploring how much equity you have and what it can do for your goals is a smart step toward long-term growth and stability.
