Plenty of Fort Worth commercial property trades well below institutional size: a five-bay flex building off Loop 820, a small strip center in a Tarrant County suburb, a two-story office near the Near Southside. These deals need a lender that underwrites the building itself, not one that wants a $20M minimum.
In short: LendingStreet makes small-balance commercial loans in Fort Worth, roughly $500K to $5M, for investors buying or refinancing small retail strips, office buildings, flex and light industrial, self-storage and mixed-use property. Loans are sized on NOI, DSCR and LTV with custom terms and up to 75% LTV on acquisitions. The property must be cash-flow positive, and LLC borrowers are standard.
Small-balance commercial loans are for income property in roughly the $500K to $5M loan range. In Fort Worth that usually means buildings with a handful of tenants, owned by individual investors, partnerships or small funds.
Our investor loans are business-purpose loans on non-owner-occupied property. The building should be leased to tenants other than the borrower's own business. Apartment buildings with 9 or more units are covered on our Fort Worth multifamily page, and 1 to 8 unit rentals use our residential programs.
| Property type | Common Fort Worth examples | What gets the closest look |
|---|---|---|
| Small retail strip | Suburban strips along arterial roads in Tarrant County | Tenant mix, lease rollover, who pays taxes and CAM |
| Small office | Converted houses and low-rise office near the Near Southside and Medical District | Occupancy, lease length, parking |
| Flex and light industrial | Multi-bay buildings along Loop 820, I-35W and in north Fort Worth | Use history, environmental review, lease terms |
| Self-storage | Facilities on the growing edges of the metro | Occupancy history, management, expansion land |
| Mixed-use | Storefronts with apartments on older corridors | Blended NOI and the commercial share |
A large shopping center can lose a tenant and barely notice. A five-bay building loses 20% of its income when one tenant leaves. That is why underwriting on small-balance loans looks hard at lease expiration dates, renewal history and how long similar space has taken to re-lease.
Spread-out lease expirations are easier to underwrite than several leases ending in the same year. If two of your five leases end within the next year, expect underwriting to plan for some downtime and possibly a larger reserve.
This example is illustrative and not a quote. Rents, vacancy and expenses are assumptions for the math, not Fort Worth market data.
An investor buys a five-bay flex building for $1,250,000. Each bay leases for an assumed $2,350 a month on modified gross leases, for $141,000 of scheduled rent. Underwriting applies an assumed 8% vacancy and credit loss, leaving $129,720. Taxes are $22,000, insurance $7,500 and repairs, management and reserves $15,000, so NOI is $85,220.
The 75% LTV test would allow $937,500. The 1.25x DSCR test sets the loan at $785,000, with estimated annual debt service of $68,088, DSCR of 1.25x and LTV of 62.8%. The investor brings $465,000 plus closing costs and reserves.
| Item | Amount |
|---|---|
| Purchase price | $1,250,000 |
| Scheduled rent, 5 bays | $141,000 |
| Effective income after 8% vacancy | $129,720 |
| Property taxes | $22,000 |
| Insurance | $7,500 |
| Repairs, management and reserves | $15,000 |
| NOI | $85,220 |
| Loan at 75% LTV test | $937,500 |
| Loan at 1.25x DSCR test | $785,000 |
| Estimated annual debt service | $68,088 |
| DSCR | 1.25x |
| LTV | 62.8% |
Small Fort Worth commercial buildings use a mix of lease types. Under a net lease, tenants reimburse some or all of the taxes, insurance and common-area costs. Under a gross lease, the owner pays them. Many small buildings use modified gross leases somewhere in between.
The lease type changes NOI more than many buyers expect, especially in Texas, where taxes are a large share of operating costs. Underwriting reads each lease to see which costs actually pass through, and whether reimbursements have really been collected.
Fort Worth property is taxed by several local taxing units on the appraisal district's value, and owners can protest that value each year. A small building that changes hands may see a higher assessment, so budget on a realistic post-sale figure.
Hail and wind are a fact of life in North Texas, and older metal or flat roofs on flex and strip buildings can push premiums and deductibles up. Because Texas is a non-disclosure state, comparable sales for small commercial buildings are not public record, so appraisals often rely heavily on the income approach and the leases you provide.
Self-storage is underwritten on occupancy history and collected rent rather than long leases, so 12 to 24 months of monthly operating reports help. Flex and light industrial buildings get more environmental attention, because past tenants may have used chemicals, fuel or solvents. A Phase I environmental report is common, and further testing may follow if it flags a concern.
For flex buildings, also confirm that each bay's current use fits the zoning and certificate of occupancy, and note whether tenants have added mezzanines, paint booths or other improvements that may need permits.
A small building that is leased and cash-flow positive fits a permanent purchase or refinance loan. If you already own it and the income has grown, a cash-out refinance can pull equity out, sized on current NOI and the new appraised value.
If the building is half empty, needs a new roof before tenants will sign, or is being re-tenanted after a long-time occupant left, a commercial bridge loan may fit first. Bridge loans are short-term and interest-only, and the plan is to refinance into a permanent loan once the building is leased.
Either way, underwriting looks at you as well as the building. Experience owning or managing similar property, the liquidity you hold after closing and a realistic plan for vacancies all help on a small file, where one tenant can swing the numbers.
Small-balance commercial loans take longer than residential loans. A full appraisal, lease review and third-party reports are common, so build time into your contract and send documents early.
Send the property type, address, rent roll and leases through the form below, or call (877) 298-1001. We will rebuild NOI from the leases, test the loan on DSCR and LTV, and return custom terms for that building. Recourse varies by program.
Roughly $500K to $5M. Larger Fort Worth commercial loans are reviewed case by case under our broader commercial programs.
It can be reviewed, but income depends on one lease, so the tenant, lease term and re-leasing risk get close attention.
No. These loans are for investors leasing to tenants. Our investor loans are business-purpose loans on non-owner-occupied property.
The DSCR test often limits the loan before the LTV cap does, especially once Fort Worth taxes and insurance are counted in NOI.
Often, yes. Flex and light industrial uses get closer environmental review because of past tenant activity.
Yes, stabilized self-storage with an operating history can be reviewed. Bring monthly occupancy and income reports.
Faster with a complete file, but slower than a residential loan, because of appraisal, lease review and third-party reports.
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