Generally, yes. Mixed-use properties involve layered risk and more complex underwriting. Strong performance across all uses and experienced ownership can significantly improve financing options.
Loan terms are typically based on the largest income-producing use. For example, properties with a majority of residential income may qualify for more favorable terms than those dominated by retail or office space.
Many lenders impose limits on the percentage of non-residential square footage or income. Properties exceeding these thresholds may require specialized lenders or alternative loan structures.
Often, yes. Lenders may require reserves for tenant improvements, leasing costs, capital expenditures, or operating shortfalls due to the complexity of managing multiple uses.
Mixed-use commercial loans finance properties with two or more distinct uses, such as residential and retail. Lenders underwrite these loans by evaluating each income stream separately and collectively, with terms often driven by the dominant use.
