What Is A Multi-Purpose Property
As its name implies, a multi-purpose property is commercial real estate comprised of improved land with a building that has multiple purposes or uses as opposed to buildings that have a single-purpose or use.
The primary determining factor whether a property is considered multi-purpose has to do with the design of the building and not the activity of the occupant.
For example a light industrial building with office space and a warehouse has many possible purposes and uses. Therefore, many different types of businesses or organizations may occupy and immediately begin to use the space without altering the buildings configuration.
This is true for a manufacturer, distributor or even a church or other type of non-profit organization.
Therefore, multi-purpose properties are easier to sell or lease and pose less risk to lenders and the SBA. As we’ve learned in the past, less risk means lower rates and more favorable terms.
As a result, multi-purpose properties qualify to be financed by the SBA 504 program which offers low rates and the ability to obtain financing up to 95% loan to value for strong credit applicants.
Popular types of multi-purpose properties include: Industrial, Light Industrial, Warehouse, Office and Office Condo.
My SBA Loan Pro
The My SBA Loan Pro Podcast is hosted by Your SBA Loan Pro, Ryan Smith. In each episode Ryan provides valuable information and best practices regarding the SBA loan program.
Each episode is approximately one minute in length and addresses topics related specifically to SBA 7(a) and 504 loan programs to purchase real estate, acquire a business or franchise and obtain working capital.
You’re encouraged to listen and subscribe to ensure you’re notified each time a new episode is available. Ryan publishes a new episode weekly on Tuesday mornings, unless he’s kidnapped to a deserted island of course.