In short: A commercial property loan finances a warehouse, factory, shop, office or medical suite, whether you will occupy it for your own business or lease it to a tenant. Melbourne lenders typically lend 65–80% of the value, over 15–25 years, and price the loan on the property, the tenant and your business income. GNT Finance compares full doc and lease doc options across banks and non-bank lenders.
Commercial lending works differently from a home loan. There is no "standard" product, rates are negotiated rather than advertised, and two lenders can quote wildly different terms on the same Somerton warehouse. GNT Finance, based in Mickleham, arranges commercial property loans for business owners and investors across Melbourne's north and the wider city, from a first factory unit in Campbellfield to a tenanted retail strip in Craigieburn.
Who this is for
- Business owners buying their own premises. Tradies outgrowing the rented shed, importers who need a loading dock, allied-health practices buying a consulting suite instead of paying a landlord.
- Commercial investors. Buyers of leased warehouses, childcare centres, shops with a national tenant or small office suites who want yield.
- SMSF trustees. A super fund can buy business premises and lease them back to your company; see our SMSF loans page.
If your income is largely self-employed, read this alongside our self-employed loans service, because the two assessments overlap.
The main differences from a home loan
| Feature | Residential home loan | Commercial property loan |
|---|---|---|
| Typical maximum LVR | 80% (up to 95% with LMI) | 65–80% depending on asset and lender |
| Loan term | Up to 30 years | Usually 15–25 years, some to 30 |
| Interest rate | Advertised, standardised | Negotiated; risk-priced per deal |
| Regulation | NCCP consumer credit | Generally unregulated if for business purposes |
| GST | Not applicable on established homes | Often payable on purchase (input-tax credits may apply) |
| Valuation | Usually free or a few hundred dollars | Paid by borrower, commonly $2,000–$6,000+ |
| Repayment types | P&I or interest-only | P&I, interest-only, or balloon payments |
| Annual review | Rare | Some lenders review financials annually |
Loan options we compare
Full doc gives the sharpest pricing because the lender sees the business servicing the debt. Lease doc relies on the rent alone (usually 1.2 to 1.5 times interest cover) with minimal personal financials. Low doc substitutes an accountant's declaration or BAS for tax returns at a lower LVR; see low doc loans explained. SMSF loans use a limited recourse borrowing arrangement serviced by contributions plus rent.
| Option | Who it suits | Typical LVR | Documents |
|---|---|---|---|
| Full doc | Trading business with clean financials | Up to 80% | 2 years financials, tax returns, BAS, ATO portals |
| Lease doc | Investor with tenanted property | 65–70% | Lease, rental schedule, valuation |
| Low doc | Newer or fast-growing business | 60–70% | Accountant's letter, BAS, bank statements |
| SMSF | Fund buying business premises | 60–70% | Trust deeds, fund financials, lease to business |
How GNT Finance arranges your commercial loan
- Strategy call. We look at what you are buying, how it will be used, and whether to hold it personally, in a company, a trust or your SMSF. Structure affects tax, land tax and the loan, so loop in your accountant early.
- Servicing and structure. Gorakh Timilsina spent years as a Senior Credit Officer assessing business applications. He builds the servicing position the way a credit team will read it, including add-backs like depreciation and one-off expenses.
- Lender shortlist. We approach two or three lenders that actually like your asset class. Some banks are cold on hospitality but keen on industrial; non-banks may accept a shorter lease.
- Indicative terms. We negotiate rate, fees, LVR and covenants in writing before you commit to a valuation.
- Valuation and formal approval. The lender orders a commercial valuation; we manage the queries, which can include environmental reports for industrial sites.
- Settlement. Your solicitor handles the contract and GST treatment; we coordinate loan documents and funds. Many Melbourne commercial contracts run 60–90 days.
Eligibility and what you will need
Lenders weigh the asset, the income and the borrower.
The asset. Standard industrial and retail in established precincts (Somerton, Campbellfield, Thomastown, Epping, Tullamarine) are easiest. Petrol stations, pubs, motels and rural land attract lower LVRs and fewer lenders.
The income. For owner-occupiers, business profit after adding back non-cash items. For investors, the net rent under the lease, with interest cover of at least 1.25 to 1.5 times at a buffered rate.
The borrower. A clean credit file, an established ABN (usually two years), and directors' guarantees where the borrower is a company or trust.
Typical documents: two years of business financials and tax returns (full doc), recent BAS and ATO portal statements, company or trust deeds, the lease or heads of agreement (investment), contract of sale and Section 32, a statement of assets and liabilities for each guarantor, and existing loan statements. Our home loan documents checklist is a starting point; we send a commercial-specific list once we know the structure.
Worked example: buying a warehouse in Craigieburn
Say your electrical contracting business buys a 450 sqm warehouse in Craigieburn for $1,100,000 plus GST. You claim the GST as an input-tax credit, so the loan is assessed on $1,100,000.
| Item | Amount |
|---|---|
| Purchase price (ex GST) | $1,100,000 |
| Loan at 70% LVR | $770,000 |
| Deposit required | $330,000 |
| Stamp duty (VIC general rate) | approx. $60,500 |
| Valuation, legal and lender fees | approx. $9,000 |
| Total cash to settle | approx. $399,500 |
For illustration, at 7.00% p.a. over 20 years, principal-and-interest repayments on $770,000 come to roughly $5,970 per month. If you had been paying $5,200 in rent for a similar shed, the extra $770 buys an appreciating asset, and the interest is generally deductible for the business. Interest-only for the first two or three years drops the repayment to about $4,490 per month at the same rate.
Stamp duty at the general Victorian rate is 5.5% flat between $960,001 and $2 million, so $60,500 at $1,100,000 plus registration. Check it on our stamp duty calculator or the State Revenue Office site. Commercial property is not exempt from land tax; estimate the annual bill with our land tax Victoria calculator.
Costs and fees to expect
- Establishment fee: commonly 0.5%–1% of the loan, often negotiable
- Valuation: $2,000–$6,000 for standard industrial; more for specialised assets
- Legal fees: lender's solicitor costs are often passed on ($1,500–$3,500)
- Ongoing and annual review fees: monthly or yearly, plus line fees on some facilities
- Break costs: substantial on fixed-rate commercial loans
We negotiate fees as part of the lender comparison rather than treating them as fixed.
Mistakes we see, and how to avoid them
Signing before finance is sorted. Commercial contracts are often unconditional or have short finance windows. Get indicative terms first.
Ignoring the GST position. Whether the sale is a "going concern" or a plain taxable supply changes your cash at settlement by tens of thousands.
Buying in the wrong entity. Moving a property from your name into a trust later triggers duty again. Decide the structure once.
Underestimating vacancy. Model three to six months without rent between tenants and check you can still service the loan.
Overlooking the lease terms. A short remaining lease, demolition clauses or a related-party tenant can all reduce what a lease doc lender will offer.
Why use a mortgage broker for commercial lending
Commercial credit is discretionary. A bank's business banker can only sell that bank's appetite on that day. GNT Finance takes your deal to multiple lenders through our lender panel, presents it the way a credit team wants to read it, and negotiates rate and terms on your behalf. Because Gorakh assessed applications from the credit side before founding GNT Finance, we know which add-backs are accepted, which covenants can be softened and when to walk away from a lender that will not move.
We also consider whether your home loan should be refinanced to release equity for the deposit. Broker remuneration on commercial loans is typically paid by the lender; where a fee applies we quote it in writing upfront.
Frequently asked questions
How much deposit do I need for a commercial property in Melbourne?
Most lenders require 20–35% of the purchase price, so a $900,000 warehouse typically needs $180,000–$315,000 plus stamp duty and costs. You can use equity in your home as part of the deposit, which many business owners in Melbourne's north do. Specialised properties and lease doc loans generally sit at the higher end of that deposit range.
Can I get a commercial loan without full tax returns?
Yes, through low doc or lease doc products. Low doc uses an accountant's declaration, BAS or trading statements in place of returns, at a lower LVR and slightly higher rate. Lease doc relies on the rent from a tenanted property instead of your income. Both have fewer lenders than full doc, so shortlisting the right one matters.
Is the interest rate on a commercial property loan higher than a home loan?
Usually, yes. Commercial rates sit above residential rates because the lender carries more risk and the loans are individually priced. The gap depends on your LVR, the asset type, lease strength and business track record. Strong owner-occupier deals at 65% LVR get the tightest margins, while low doc or specialised assets pay more.
Can my SMSF buy my business premises?
It can. Your fund purchases the property with a limited recourse borrowing arrangement, then leases it to your business at a market rent supported by a valuation. The rent goes into your super and is deductible to the business. Strict rules apply on related-party dealings and the fund's liquidity, so we work with your accountant and financial adviser on this.
How long does commercial loan approval take?
Allow three to six weeks from application to formal approval for a straightforward deal, mainly driven by the valuation and the lender's credit queue. Complex structures, specialised property or environmental reports can extend this. Getting indicative terms before you sign a contract and asking for a 45–60 day finance clause makes the process far less stressful.
Talk to GNT Finance
Whether you are buying your first factory unit or adding a leased retail property to your portfolio, GNT Finance will tell you plainly what lenders will offer and at what price. We work with business owners across Craigieburn, Somerton, Epping and all of Melbourne, in English, Nepali or Hindi. Book a free consultation or call 0426 403 703.
Written by Gorakh Timilsina
Founder, CEO & Senior Mortgage Consultant at GNT Finance. Gorakh started as a broker assistant, spent years as a senior credit officer assessing loan applications, and now helps Melbourne families get the right loan approved. English, Nepali and Hindi spoken.