Today’s rates for a wide range of commercial property and loan types.
Check Today's Rates →
Commercial Property Loans in Chicago
- Economy in Review
- Multifamily Market
- Office Market
- Industrial Market
- Retail Market
- Self-Storage Market
- Hospitality Market
- Commercial Real Estate Loans by Purpose
- Permanent Financing
- Refinancing a Commercial Real Estate Property in Chicago
- Construction Financing
- Bridge Loans
- Commercial Real Estate Loans by Type
- Bank Loans
- Life Company Loans
- Agency Loans
- HUD Loans
- CMBS Loans
- SBA Loans
- Mezzanine Loans
- Commercial Property Insurance in Chicago
- Get Financing
Economy in Review
Chicago, Illinois is a bustling city with a diverse economy. The city is home to several Fortune 500 companies and has a strong presence in industries such as finance, healthcare, and transportation. The Bureau of Labor Statistics reports that the unemployment rate in Chicago is slightly higher than the national average, but has been steadily decreasing over the past few years.
The city's economy has also been impacted by the COVID-19 pandemic. While some industries have seen growth, others have struggled. However, the city has implemented several initiatives to support small businesses and encourage economic recovery.
Multifamily Market
The multifamily market in Chicago has remained strong despite the pandemic. According to the U.S. Census Bureau, the city's population has been steadily increasing over the past few years, which has driven demand for rental properties. Additionally, several new multifamily developments have been completed or are currently under construction in the city.
Office Market
The office market in Chicago has also been impacted by the pandemic. Many companies have shifted to remote work, which has led to increased vacancy rates in some areas of the city. However, there are still several large office buildings that are fully occupied by major corporations.
Industrial Market
The industrial market in Chicago is one of the strongest in the country. The city's central location and access to major transportation routes make it an ideal location for logistics and distribution centers. Additionally, there has been an increase in demand for industrial space due to the growth of e-commerce.
Retail Market
The retail market in Chicago has faced challenges due to the pandemic and increased competition from online retailers. However, there are still several thriving retail areas in the city such as Michigan Avenue and the Magnificent Mile. Additionally, there has been an increase in demand for retail space in some of the city's up-and-coming neighborhoods.
Self-Storage Market
The self-storage market in Chicago has remained strong despite the pandemic. The city's population growth has driven demand for storage space, and there are several new self-storage developments that have been completed or are currently under construction.
Hospitality Market
The hospitality market in Chicago has been heavily impacted by the pandemic. The city's tourism industry has suffered due to travel restrictions and decreased demand for travel. However, there are still several major hotels in the city that are fully operational and have seen an increase in occupancy rates as travel restrictions have eased.
Commercial Real Estate Loans by Purpose
There are many types of loans available for commercial properties in Chicago, and the best fit for you depends on your investment strategy. Here are some broad categories of financing available.
Permanent Financing
Permanent financing is a type of loan that remains in place for an extended period of time. It's commonly used to finance the acquisition of commercial properties or to refinance existing debt. Types of permanent financing include bank loans, loans from government-sponsored entities like Fannie Mae and Freddie Mac, HUD loans, credit union loans, loans from life insurance companies, commercial mortgage backed securities (CMBS) loans, and other types of loans depending on the specifics of the commercial property.
Refinancing a Commercial Real Estate Property in Chicago
I wouldn't quite call this a separate type of loan, but I have to mention refinancing in here. These are typically permanent loans (but not always) used to pay down an existing, partially amortizing or interest-only loan.
Often you may be able to time a refinance to happen after an interest rate drop — an ideal solution — but if your loan is maturing during a period of higher rates, you shouldn't stress too much about this. We'll work with you to find the best loan terms for your commercial property by reaching out to potentially thousands of lenders. Just complete the form below, and we'll get to it.
Construction Financing
Construction financing, also known as interim financing, is used to finance the cost of construction for commercial properties. It is usually a short-term loan that covers the cost of land development and building construction. Once construction is completed, the borrower can typically convert this into a permanent loan or pay it off with a new loan.
Bridge Loans
Bridge loans are a type of short-term loan that can be used to cover costs in the interim period between the end of one loan and the beginning of another. They are typically used in commercial real estate to finance the transition between construction financing and permanent financing. Bridge loans generally have higher costs than most other financing options and are often interest-only and non-recourse.
Commercial Real Estate Loans by Type
Depending on the purpose of your loan, you will have several financing options available to meet your investment goals. Read below to learn more about specific loan types.
Bank Loans
Bank loans are a common financing option for commercial real estate in Chicago. They can offer competitive interest rates and flexible terms, but the specifics can vary greatly from bank to bank. While they may not always be the best fit for larger, more complex projects, they can be an excellent option for smaller, simpler properties.
Life Company Loans
Life company loans are typically used to finance high-quality assets in major markets. They generally have lower loan-to-value ratios than most other loan types but offer competitive interest rates and long terms. However, they may not be suitable for riskier projects or properties in less established markets.
Agency Loans
Agency loans, offered by government-sponsored entities like Fannie Mae and Freddie Mac, are typically used for properties that are mostly multifamily. They offer attractive loan terms, low, fixed interest rates, and are non-recourse. However, there are restrictions on the amount of income that can come from other commercial uses.
HUD Loans
HUD multifamily loans are government-backed loans that are primarily used for the construction, substantial rehabilitation, purchase, and refinancing of multifamily properties. These loans offer long-term, non-recourse financing with competitive interest rates but have extensive requirements for qualification.
CMBS Loans
Commercial Mortgage Backed Securities (CMBS) loans are a type of mortgage-backed security backed by commercial real estate loans. Lenders focus more on the strength of the property than the borrower's credit, making them a good option for properties with strong cash flow.
SBA Loans
Small Business Administration (SBA) loans, such as the SBA 7(a) and SBA 504, offer attractive financing options for small businesses. However, the maximum amount for an SBA 7(a) loan is $5 million, while SBA 504 loans can go up to $20 million. They cannot be used for multifamily properties and are only available for properties that the business owner occupies.
Mezzanine Loans
Mezzanine financing is a hybrid form of financing that combines elements of debt financing and equity investment. It is typically used in commercial real estate to fill a funding gap between the primary loan and the total cost of a project.
Commercial Property Insurance in Chicago
This part isn't about loans, but it's just as important to your investment's success. Let's talk (quickly) about insurance.
Insurance premiums have skyrocketed in the past few years, as I'm sure you know. While multifamily gets a lot of the attention, rates for insuring anything from office buildings to shopping centers have jumped significantly.
Janover Insurance Group is dedicated to finding the best insurance solutions for your commercial real estate assets in Chicago. Click to get a free insurance quote for your property — no obligation.
- Economy in Review
- Multifamily Market
- Office Market
- Industrial Market
- Retail Market
- Self-Storage Market
- Hospitality Market
- Commercial Real Estate Loans by Purpose
- Permanent Financing
- Refinancing a Commercial Real Estate Property in Chicago
- Construction Financing
- Bridge Loans
- Commercial Real Estate Loans by Type
- Bank Loans
- Life Company Loans
- Agency Loans
- HUD Loans
- CMBS Loans
- SBA Loans
- Mezzanine Loans
- Commercial Property Insurance in Chicago
- Get Financing