What are (realistic) cash down requirements for buying commercial property?

I just bought some land and now the banks are requiring 20% down, rather than the 10% they required not too long ago. Is this the norm now for commercial property too? How do SBA guarantees figure in to this, if at all?
I'm considering starting a franchise, but I'd like to buy the site first. I have thoughts about future expansion and starting complimentary franchises on one site.
I have the cash/401K loan/etc for the franchise, but after that I'm mostly tapped out. So probably have no where near 20% for the property. I considered lease to purchase but that doesn't seem to be an option.
Thoughts? Advice?
In Buying Property - Asked by Bob C. - Oct 18, 2008
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Answer(s)

Eric S.
Broker/Agent
Fall River, MA

A safe bet is 25% If you can't come up with the money, look for another deal/location. Over leveraging yourself leads to financial turmoil. Gotta crawl before you can run

Oct 21, 2008
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Bruce K.
Corporate Investor
Riverside, CA

Look for an investor.
Find someone willing to buy the land & do a "build to suit" lease with you for the buildings. Or, you could even participate as a partner in buying and developing the land, with you (your franchise) as the tenant in the future completed building.
The fact that the building would be already "pre-leased" with you as the tenant should be attractive to a potential investor.

Oct 21, 2008
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Joe V.
Owner/Investor
Plymouth, MI

First issue is don't go to the banks for your financing (or Hard Money sources either). Both are not your best friends right now and treat all deals as high risk and charge heavily because of that...if they approve it at all. My sources are all private. Always have been. Best one I've found is www.commercialfinanceconsultants.com. They can supply both business Lines of Credit (non-signatory/non-secured) and 100% financing /100% LTV at great rates. 6.5%-8.25% with no points. The use creative financing at its best. I won't go anywhere else.

Nov 12, 2008
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