The building is a good buy, but it is half empty, under-rented or needs work. A permanent lender will not size a loan on income that is not there yet.
In short: A commercial bridge loan is short-term investor financing, usually 12 to 24 months, that funds the purchase or refinance of a non-owner-occupied commercial property while the investor leases it up, renovates or stabilizes it. LendingStreet finances commercial bridge deals on custom terms, typically $500K to $5M+. The loan is sized on the property’s value and your business plan, not just current income. You repay it by refinancing into long-term debt or selling.
Bridge financing is built for investment properties in transition. If a building already has strong, long-term leases, a permanent commercial loan is usually cheaper.
Bridge fits when today’s income does not reflect what the property will earn once you execute the plan. It also fits when you need to close faster than a permanent lender can.
Most commercial bridge loans are interest-only, so payments stay low while income is building. Terms are commonly 12 to 24 months, often with extension options for a fee.
Leverage is set deal by deal. Our bridge programs reach up to 85% LTV on qualifying investor deals, but commercial leverage depends on the property type, occupancy and your plan, and it is frequently more conservative than that ceiling.
| Feature | Commercial bridge loan | Permanent commercial loan |
|---|---|---|
| Term | Commonly 12–24 months | Multi-year |
| Payments | Usually interest-only | Usually amortizing |
| Sized on | Value and business plan | In-place NOI and coverage |
| Best for | Vacancy, renovation, speed | Stabilized, leased buildings |
| Cost | Higher rate and points | Lower rate |
Example only, not a quote. An investor buys a six-bay retail strip for $1,600,000. Three bays are leased, and current NOI is about $62,000, too low for a permanent loan at that price.
The investor uses an assumed $1,200,000 interest-only bridge loan and leases the other three bays over 10 months. Stabilized NOI rises to about $128,000. At an assumed 1.25x coverage target and annual payments equal to 8% of the loan, the building now supports roughly a $1,280,000 permanent loan, enough to retire the bridge.
| Stage | Occupancy | NOI | Financing |
|---|---|---|---|
| Purchase | 3 of 6 bays | About $62,000 | $1,200,000 bridge loan, interest-only |
| Month 10 | 6 of 6 bays | About $128,000 | Ready to refinance |
| Refinance | Stabilized | About $128,000 | About $1,280,000 permanent loan |
A bridge loan is only as good as the way out of it. Underwriters want to see how you will lease the space, what rents you expect, and what the refinance or sale looks like.
Build your plan with conservative timelines. Commercial leasing often takes longer than investors expect, so ask about extension options before you close.
Pricing depends on leverage, property type, how much income is already in place and your experience with similar properties. A building that is 70% leased with a clear lease-up path prices better than one that is empty.
Rehab budgets, if any, are usually funded through draws as work is completed. Your track record with similar commercial projects can improve both leverage and rate.
Send the current rent roll and leases, the purchase contract or payoff statement, your renovation budget if any, and a one-page business plan with target rents and timing.
Our financing team reviews the investment and typically brings back 2–3 options, often within 48 hours. Each option is laid out so you can compare leverage, cost and term.
Terms are commonly 12 to 24 months, and many include extension options for a fee. Pick a term with room for leasing delays rather than the shortest available.
Yes, vacant and partly vacant investment properties are a common bridge use. Leverage is usually lower on a fully vacant building, and a credible leasing plan matters more.
Our bridge programs can close in as little as 10 days on straightforward deals. Commercial properties often need more third-party work, so timing depends on reports, title and how quickly documents arrive.
You may be able to use an extension option, sell the property or refinance into another short-term loan. Talk to your loan officer early, well before maturity, if leasing is behind schedule.
No. Our bridge loans are for non-owner-occupied investment property leased to tenants. Owner-user business property falls outside our programs.
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