Economy in Review

Frisco, Texas has experienced steady economic growth in recent years, with a diverse range of industries contributing to the city's success. The unemployment rate in Frisco is below the national average, and the city has a higher median household income than the state of Texas as a whole. The Bureau of Labor Statistics reports that job growth in Frisco has outpaced the national average, with particularly strong growth in the healthcare, education, and professional services sectors.

Despite the challenges posed by the COVID-19 pandemic, Frisco's economy has remained resilient. The city has implemented measures to support local businesses and workers, including grants and loans for small businesses and workforce training programs.

Multifamily Market

The multifamily market in Frisco has been strong in recent years, with high demand for rental properties driven by population growth and a thriving job market. According to the U.S. Census Bureau, Frisco's population has grown by over 40% since 2010, and this trend is expected to continue. As a result, developers have been building new apartment complexes to meet demand. However, rental rates have remained relatively stable due to the high level of competition among landlords.

Office Market

The office market in Frisco has also been growing steadily, with several large corporations establishing headquarters or regional offices in the city. This has driven demand for office space, particularly in newer developments with modern amenities. However, the COVID-19 pandemic has led to an increase in remote work and a decrease in demand for traditional office space. As a result, some developers are shifting their focus to mixed-use developments that include both office and residential space.

Industrial Market

The industrial market in Frisco has seen significant growth in recent years, with several large distribution centers and manufacturing facilities opening in the city. This has been driven by Frisco's location near major highways and its proximity to the Dallas-Fort Worth metro area. The industrial market has remained strong during the COVID-19 pandemic, with increased demand for e-commerce and logistics facilities.

Retail Market

The retail market in Frisco has been impacted by the COVID-19 pandemic, with many businesses closing or reducing their hours. However, the city has implemented measures to support local businesses, including grants and loans. Frisco is home to several large shopping centers, including Stonebriar Centre and The Shops at Legacy, which have remained popular destinations for shoppers.

Self-Storage Market

The self-storage market in Frisco has seen steady growth in recent years, with several new facilities opening in the city. This has been driven by population growth and a high demand for storage space among residents and businesses. The COVID-19 pandemic has led to an increase in demand for self-storage as people move or downsize their homes.

Hospitality Market

The hospitality market in Frisco has been impacted by the COVID-19 pandemic, with decreased demand for hotels and restaurants. However, the city has implemented measures to support local businesses, including grants and loans. Frisco is home to several large hotels and resorts, including the Omni Frisco Hotel and the Westin Stonebriar Hotel & Golf Club.

Commercial Real Estate Loans by Purpose

There are many types of loans available for commercial properties in Frisco, 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 Frisco

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 Frisco. 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 Frisco

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 Frisco. Click to get a free insurance quote for your property — no obligation.