A commercial bridging loan is short-term finance secured against non-residential property such as offices, shops, warehouses or industrial units. It is typically used where a purchase or project needs to move faster than a conventional commercial mortgage allows, or where the property does not yet meet a term lender’s criteria.
In short: Commercial bridging is secured on business premises, usually runs for months rather than years, and is repaid through a sale or a refinance. Lenders focus on the value of the property, the loan-to-value and the strength of the exit rather than on long-term income alone.
What is a commercial bridging loan used for?
- Time-critical purchases, including auction lots and off-market deals with short completion deadlines.
- Vacant or part-let buildings that a term lender may not finance until tenants are in place.
- Refurbishment or repositioning of tired stock before letting or sale.
- Capital raising against an existing commercial asset for a defined business purpose.
How do lenders assess commercial property?
Commercial valuations depend heavily on use, location, lease terms and tenant quality. A lender will normally consider:
- the open market value and, where relevant, a 90- or 180-day restricted sale value;
- the condition of the building and any works needed;
- existing leases, rent levels and vacancy;
- the borrower’s experience with similar assets.
Loan-to-value limits on commercial property are often more conservative than on standard residential stock, because specialist buildings can take longer to sell. Our guide to loan-to-value in bridging finance explains how this affects the size of a facility.
What makes a credible exit?
Every bridge needs a defined route to repayment. For commercial property this is usually a sale, or a refinance onto a commercial mortgage once the building is let, refurbished or stabilised. Lenders look for evidence: agent appraisals, heads of terms with tenants, or a term lender’s indicative appetite. Read more on bridging exit strategies.
Frequently asked questions
What is a commercial bridging loan?
It is short-term finance secured against non-residential property such as offices, retail units or industrial buildings, usually repaid through a sale or a refinance.
How long does a commercial bridging loan last?
Terms are usually measured in months rather than years. The exact term is agreed case by case and should match a realistic exit timetable.
Can a commercial bridging loan be used for a vacant building?
Yes. Bridging is often used for vacant or part-let property that a term lender may not finance until it is let or refurbished.
Is commercial bridging regulated by the FCA?
Lending secured on commercial property for business purposes generally falls outside FCA-regulated mortgage lending. Borrowers should take independent advice.
Important information
Ponte Finance PLC is a private lender, not a bank, and is not authorised or regulated by the Financial Conduct Authority. Lending is for business purposes only and is not available to consumers or for property occupied, or to be occupied, by the borrower or a family member as a home. All loans are secured against property, and the property may be repossessed if repayments are not maintained. This article is for general information only and reflects publicly available data at the date of publication. It does not constitute an offer of finance, a forecast, or financial, investment, tax or legal advice. Ponte Finance PLC is registered in England and Wales, company number 15859004, registered office 225 Clapham Road, London SW9 9BE.