When the walls you own hold more than memories — when they hold value — decisions feel heavy. We know that blend of pride and worry. You want to free up cash without losing control.
At Property Equity Loan, we guide you through today’s market with clarity. Over 50 banks usually offer business financing in Singapore, and typical commercial property loan interest rates sit around 2.8%–3.2% p.a.
We help you compare packages from major lenders so you can see how floating and fixed options, benchmarks like 3‑month SORA plus a bank spread, and lock‑in terms affect monthly payments.
Our team explains what LTV norms mean for own‑use versus investment properties, how tenure ties to remaining lease, and why the “thereafter” rate matters when you reprice or refinance.
Key Takeaways
- Typical interest rates in Singapore range about 2.8%–3.2% p.a.; packages vary by lender.
- Floating vs fixed affects payments; benchmarks like 3‑month SORA set the base.
- LTV norms differ: higher for own‑use, lower for investment properties.
- Lock‑in and thereafter rates can materially raise lifetime costs.
- Remaining lease can cap tenure and increase monthly installments.
- Whatsapp us at to get latest deals and a tailored review with Property Equity Loan.
Singapore’s commercial property financing landscape at present
The current market mixes competitive offers with careful underwriting — which means choice, but also the need for sharper comparison.
Over 50 banks and finance houses in Singapore provide funding for business real estate today.
Typical interest rates sit around 2.8%–3.2% p.a.. In some cases, fixed packages hover near 3.2% — an unusual inversion versus floating offers.
Lenders price floating packages off benchmarks such as SORA, board references, fixed deposit costs or a funds rate, then add a margin. Lock‑ins commonly run 1–3 years. If you don’t plan ahead, the thereafter figure can jump sharply.
“Choice is good. Clarity is better — compare benchmarks, tenures, and your business profile.”
- Tenures often range 20–30 years, but remaining lease can shorten the term.
- Underwriting focuses on your business cash flow and track record as much as the asset.
- We monitor lenders daily. Whatsapp us at to get the latest deals or a quick market pulse check.
Compare commercial property loan rates: fixed vs floating packages and benchmarks
Understanding how offers are priced makes choice much easier.
Today, typical interest ranges sit around 2.8%–3.2% p.a.. Banks usually set floating packages as a benchmark plus a bank spread. That makes your effective rate simple to compute.
For example, Year 1 might be 3‑month SORA + 1% and Year 2 SORA + 2%. If 3‑month SORA is 2.5%, Year 1 equals 3.5% p.a.
How benchmarks differ
Boards and cost-of-funds approaches are less transparent than SORA. Funds rate references tie pricing to a bank’s internal funding mix. That affects predictability.
| Package type | Typical structure | Short-term example | When it helps |
|---|---|---|---|
| Floating (SORA + spread) | Benchmark + margin | 3‑month SORA + 1% → 3.5% if SORA=2.5% | When you expect benchmarks to fall |
| Fixed interest | Single fixed % for term | 3.2% fixed for 2 years | When you want payment certainty |
| Board / funds rate | Bank-defined base + spread | Varies by lender policy | When margin negotiation is possible |
We compare fixed and floating over your expected holding period, stress‑test benchmark moves, and flag lock‑in or break costs. For a tailored fixed vs floating guide, see our fixed vs floating guide.
Whatsapp us at to get latest deals and a personalised comparison from Property Equity Loan.
Lenders’ criteria, LTV limits, and what affects your approved loan amount
Lenders weigh a mix of balance‑sheet numbers and business context when deciding how much they will advance.
Typical LTV norms: for own‑use assets, banks usually offer 80%–90% of valuation. For investment assets, expect 60%–70%.
- Underwriting looks at operating history, annual revenue, profitability, and cash flow strength.
- Property use, lease profile, and location shape credit appetite.
- Some structures let total financing reach 100%–120% by pairing an ~80% mortgage with unsecured business term loans. We outline associated repayment risks.
| Factor | Typical bank focus | Impact on approved amount |
|---|---|---|
| Operating history | 3–5 years trading, audited accounts | Higher approval and better terms |
| Cash flow | Debt coverage, stability | Raises permissible leverage |
| Ownership structure | IHC vs operating company; guarantees | May trigger shareholder TDSR checks or covenants |
Commercial underwriting does not follow a single TDSR rule. For holding companies, banks may assess shareholders and ask for corporate guarantees.
We package your application to meet credit expectations and improve approval odds. Whatsapp us at to get latest deals and a tailored assessment for your situation.
Loan tenure, lock-in period, and leasehold realities that shape your repayments
Loan duration and lease clocks interact in ways that can compress available term and push up installments.
Typical loan terms: 20–30 years and how remaining lease caps tenure
Most borrowers target 20–30 years to spread monthly servicing. Lenders, however, check the remaining lease before they set the maximum term.
Financial institutions commonly require 5–10 years of lease life beyond the loan’s end date. If a site has 20 years left, a bank may limit your maximum term to 10–15 years.
Impact on installments: shorter tenure, higher monthly servicing
Shorter terms raise monthly payments and tighten cash flow. We model scenarios so you see the servicing difference before you commit.
- Longer term improves liquidity but increases total interest paid.
- Align your lock-in period with sales, renovations, or refinance plans to avoid penalties.
- Where leases are tight, we search lenders and structures (partial prepayment or step‑up plans) that ease early-year strain.
We help you match tenure, term, and installment goals to the realities of your properties. Whatsapp us at to get latest deals and a tailored tenure analysis.
Refinancing, repricing, and the “thereafter” interest rate risk
A sharp jump after your lock‑in can change monthly payments overnight, so planning the next move is essential.
Most facilities carry a 1–3 year lock‑in period. After that, the thereafter interest rate can revert to board or prime references. Left unchecked, this can push effective rates above 5%–6% and strain cash flow.
Why the post-lock-in rate matters
The thereafter rate shapes your payment from year to year. A small spread difference compounds quickly over terms of a few years. We model total cost, not just headline numbers.
Timing your move
Start reviews 3–4 months before the lock‑in period ends. Repricing with your current lender avoids legal fees. If that offer isn’t competitive, refinancing takes 2–3 months for conveyancing.
Fixed vs floating on refinance
We compare fixed interest and floating options against your cash‑flow outlook and market forecasts. Our checklist also covers break costs, prepayment rights, and any fee waivers.
| Action | Typical time | Why it helps |
|---|---|---|
| Request repricing | 3–4 weeks | Saves fees and time if competitive |
| Refinance to new lender | 2–3 months | Access to better terms or lower spreads |
| Fix vs float analysis | 1–2 weeks | Aligns payments with cash‑flow and market view |
- We calendar your lock‑in end date and act early.
- We negotiate thereafter structures to avoid sudden hikes.
- You get a simple action plan and a clear cost comparison.
Property Equity Loan — Whatsapp us at to get latest deals and a free thereafter‑rate health check.
Which properties and borrowers qualify: asset types, ownership structures, and requirements
Not every asset or ownership structure attracts the same credit appetite from banks in Singapore.
Assets commonly financed:
- Offices, retail strata units, HDB shophouses, and industrial assets (B1/B2 factories, warehouses).
- Some lenders avoid JTC tenures or mixed-use conservation shophouses due to regulatory limits.
Company structure matters
Operating companies usually get broader access and features such as OD facilities secured against the asset.
Investment holding companies (IHCs) with no trading cash flow may face shareholder TDSR checks or requests for a parent corporate guarantee.
Basic eligibility and documents lenders look for
- Minimum incorporation period (typically 12–24 months) and local shareholding thresholds (e.g., 30%).
- Corporate financials, bank statements, GST returns, tenancy agreements, and lease details.
- Bank-specific underwriting on earnings, cash flow, and ownership structure.
We pre-screen your assets and company profile to match you with lenders that usually support your situation. Whatsapp us at to get latest deals and a tailored readiness checklist.
How Property Equity Loan helps you secure better rates and terms
You get a tailored shortlist of competitive packages that match your capital plan and timing. We compare live offers and show clear trade‑offs so you can choose with confidence.
Independent comparisons across lenders and packages tailored to your business
We scan 50+ lenders in Singapore and shortlist options that suit your company profile and cash flow. Our analysts benchmark offers so you see real savings, not just headline figures.
Structuring options to optimize LTV, tenure, and debt servicing
We advise on structures that balance liquidity and risk. Some banks will combine a mortgage with unsecured term loans to reach 100%–120% financing when prudent.
- Compare packages by monthly servicing, thereafter terms, and break costs.
- Optimize LTV and tenure to keep repayments sustainable.
- Evaluate OD lines for operating companies to free short‑term capital.
- We calendar repricing and allow 2–3 months for conveyancing when refinancing.
- You get a clear checklist, negotiation support, and ongoing monitoring.
Whatsapp us at to get latest deals and a custom side‑by‑side of the top three packages for your businesses.
Conclusion
Start with three simple checks: tenure fit, servicing capacity, and what happens after any lock‑in period.
Make a strong, practical plan. In Singapore, commercial property loan offers today are competitive — typical interest rates sit around 2.8%–3.2% p.a. Align your choice of assets, ownership structure, and loan terms early to improve approval odds and pricing.
Pay close attention to the thereafter rate and calendar repricing 3–4 months before your lock‑in period ends. We model fixed versus floating against your expected holding years and cash flow.
Property Equity Loan helps you prepare documents, position credit, and negotiate with lenders. Whatsapp us at to get latest deals and a tailored shortlist for your properties and loans.
FAQ
What are typical interest ranges for commercial property financing today?
Typical market pricing sits around 2.8%–3.2% p.a. for competitive offers, though final pricing depends on lender margins, your credit profile, and the chosen benchmark. Banks generally add a spread to benchmarks such as SORA or their board/prime rates to arrive at the applied interest.
How do floating packages work and what benchmark should I watch?
Floating packages link a benchmark rate—commonly SORA—to a bank spread. For example, SORA + 1.2% means you pay the current SORA plus the margin. Board rate or cost-of-funds pricing may appear for some products. Floating offers move with markets, so your repayments change as the benchmark shifts.
What should I know about fixed interest packages and lock-in periods?
Fixed packages lock your interest for a set period, often 1–5 years, protecting you from near-term rate rises. However, early exit fees may apply during the lock-in. In a shifting market, fixed pricing gives certainty but can be higher than current floating offers.
Can you show common offer structures lenders use?
Lenders often present hybrids: Year 1–2 at SORA + margin, then revert to a board or prime-based rate, or a fixed 2-year rate followed by floating. The exact structure affects cashflow and long-term cost, so compare the post-lock-in scenario closely.
What LTV limits and loan amounts can I expect?
LTV norms vary by use: roughly 80%–90% for owner-occupied assets and 60%–70% for investment-grade assets. Final LTV depends on valuation, borrower strength, and asset class. Higher funding may be possible when lenders accept blended facilities or additional security.
What key factors do banks assess when approving an application?
Lenders review operating history, revenue consistency, cash flow, tenant mix, lease terms, and the asset’s condition. They also check company structure, director guarantees, and credit history. Strong operating metrics and long leases improve approval odds and pricing.
When can I access higher financing levels?
Higher limits may be available by pairing a mortgage with unsecured term facilities, providing additional security, or using a corporate guarantee. Lenders evaluate overall debt servicing capacity and collateral coverage before increasing exposure.
How do debt servicing rules differ from residential lending?
Commercial lending focuses on total debt servicing and cashflow from operations rather than personal repayment ratios like TDSR in residential loans. Lenders model net operating income and stress-test interest costs to ensure sustainable servicing.
What loan tenures are typical and how does remaining lease affect them?
Tenures commonly range 20–30 years, but the remaining lease term of the asset can cap the loan tenure. For leasehold assets, banks often limit tenure to a portion of the residual lease, which shortens repayment periods and raises monthly installments.
How does tenure length affect repayments?
Shorter tenures mean higher monthly servicing but lower total interest cost. Longer tenures reduce monthly outflow but increase total interest. Match tenure to cashflow capacity and exit plans to balance affordability and cost.
Why does the post-lock-in (“thereafter”) rate matter?
The rate after your fixed or discounted period determines long-term cost. If the thereafter rate is linked to a high board or prime setting (5%–6%), your repayments can jump sharply. Always compare the thereafter scenario, not just the introductory offer.
When should I start reviewing refinance or repricing options?
Begin 3–4 months before your lock-in ends. That window gives time to request repricing from your lender, gather documents, and approach alternative banks if a refinance makes sense. Early planning avoids last-minute rate shocks.
Should I reprice with my existing lender or refinance elsewhere?
Repricing may be faster and incur lower upfront costs; refinancing can yield better long-term pricing if another lender offers a superior package. Compare total costs, break fees, and the new facility’s structure before deciding.
Is it better to fix or stay floating when refinancing now?
The choice depends on your risk tolerance and market view. Fixing provides certainty if you expect rates to rise. Floating may offer lower initial pricing but exposes you to moves in benchmarks. Balance certainty against potential savings.
What asset types do banks typically finance?
Lenders commonly finance office, retail, industrial, and mixed-use assets, as well as specialized commercial spaces. Each asset class has its own underwriting criteria tied to rental stability and market liquidity.
How do operating companies compare with investment holding companies for approvals?
Operating companies with predictable revenue streams often secure better pricing than investment holding companies, which rely more on asset value and rents. Banks price risk according to cashflow visibility and corporate structure.
What basic documents and eligibility criteria do lenders require?
Expect audited financials, management accounts, tenancy schedules, corporate records, and valuations. Lenders also check director profiles, company credit history, and proof of down payment or equity.
How can Property Equity Loan help secure better terms?
We provide independent comparisons across local banks and alternative lenders to identify competitive packages. We also advise on structuring to optimize LTV, tenure, and debt servicing, and help negotiate post-lock-in terms to reduce interest risk.
What structuring options improve my chances and pricing?
Options include splitting facilities (term loan plus overdraft), staged drawdowns, and blended tenors to match income streams. Adding corporate guarantees or top-up collateral can also enhance approval odds and secure tighter margins.
