Commercial real estate is a big investment. That’s why locking in the best rate for your loan matters. Even a small difference in interest rates can have a big impact on monthly payments and your long-term business finances.
But commercial real estate loan rates can vary dramatically. They depend on factors like the type of loan, current market conditions, the property itself and your qualifications.
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Average commercial real estate loan rates in 2026
Here are the average commercial real estate loan rates by loan type and property type:
| Loan type | Estimated average rate* |
|---|---|
| Conventional commercial loan
» MORE: Commercial real estate loans | 5% to 7.5%. |
| SBA 504 loan
» MORE: SBA real estate loans | 5% to 7%. |
| SBA 7(a) loan
» MORE: SBA real estate loans | Up to 11.75%. |
| Bridge loan
» MORE: Commercial bridge loans | 6% to 12%. |
| Construction loan
» MORE: Commercial construction loans | 6% to 10.5%. |
| Property type | |
| Retail | 6% to 12.5%. |
| Office | 6% to 12.5%. |
| Medical office | 5.5% to 8.5%. |
| Hotel | 6% to 12.5%. |
| Self-storage | 6% to 12.5%. |
| *Note: These rates are estimates based on publicly available information from lender websites and the SBA as of May 2026. Actual rates may vary depending on the lender, borrower qualifications and market conditions. | |
🤓 Nerdy Tip
Check out NerdWallet’s commercial real estate loan calculator to explore how different rates impact monthly loan costs. What is a commercial real estate loan?
Commercial real estate loans help business owners buy, build, renovate or refinance property used in business, such as a retail shop, a dentist’s office, a restaurant or apartment building.
These loans usually have fixed interest rates and terms that last five, seven or 10 years (or more). Many also include a balloon payment, which is a big lump sum due at the end of the loan. Like residential mortgages, if you fail to make payments, the lender can take your property.
» Learn more about commercial real estate loans
Will commercial mortgage rates go down in 2026?
The Federal Reserve has held rates steady so far in 2026, following three rate cuts in the second half of 2025. NerdWallet saw average rates for commercial real estate loans drop slightly compared with last year, likely reflecting those late 2025 cuts.
Expectations for a future rate cut in 2026 are low, but much of it depends on how the U.S. economy will fare in the months ahead. Other market factors might play a bigger role this year. Commercial real estate lending from banks has picked up in recent quarters, and a wave of commercial mortgage refinancing may follow as pandemic-era loans (and their final balloon payments) come due in 2026. This added demand might spur some lenders to edge rates higher.
How to get the best rate on a commercial real estate loan
While market conditions are outside your control, here are a few things you can do to get a lower rate:
1. Put more money down
Lenders like it when you have more skin in the game. A bigger down payment reduces their risk and can result in a lower interest rate. It also improves key financial ratios like your debt service coverage ratio (DSCR) and loan-to-value ratio (LTV), two metrics lenders watch closely.
2. Boost your credit score
While not a quick fix, strengthening your personal and business credit scores can lead to better loan terms, especially in today’s climate. Lenders use credit to evaluate your financial reliability, and higher scores generally translate to lower rates and better terms.
3. Strengthen your business finances
Lenders want to know your business is healthy and running smoothly. That’s why improving your revenue and maintaining low debt levels can go a long way in securing a better rate.
4. Shop around
Don’t settle for the first loan offer you get. Commercial real estate loan rates can vary widely from one lender to another, so it pays to compare multiple offers. If time allows, cast a wide net, including banks, credit unions, online lenders and SBA-backed options.
4. Negotiate
Unlike many consumer or small-business loans, commercial real estate loans often leave room for negotiation, especially for well-qualified borrowers. If you’ve received a better offer from another lender, use it as leverage to negotiate a lower rate, reduced fees or more favorable terms.
5. Work with a commercial mortgage broker
A qualified business loan broker can do the heavy lifting for you, potentially saving you time and money. They typically have industry connections and can often access loans you may not find easily on your own.
🤓 Nerdy Tip
Online marketplaces, like NerdWallet Small Business, can also help you find and compare loans to buy commercial real estate. What determines your commercial real estate loan rate?
Many factors impact the rate you get on a commercial real estate loan. Here’s a list of some of the most common ones:
- Lender. Not all lenders price loans the same way. Each has different risk tolerances and borrower profiles they prefer. Also, the type of lender matters a lot. For example, banks tend to offer the most competitive rates, while online lenders typically charge much more.
- Loan type. Some loan types tend to charge borrowers more than others. For example, SBA loans usually offer competitive rates, while bridge loans often charge more due to their high-risk nature.
- Loan size and term. Generally, the larger the loan and shorter the term, the better the rate (but higher your monthly payments). Lenders also want to see a healthy DSCR and LTV.
- Property details. The type of property you’re financing, its location and whether it’s owner-occupied or an investment property all impact the rate you’ll pay. For example, you’ll likely unlock a better rate if you’re financing a multifamily rental property in a popular part of town than an office building in a rural area.
- Business profile. Lenders want to see a financially healthy business. Key indicators they may look at include time in business, revenue and cash flow.
- Borrower profile. Generally, the more business experience you have and the higher your credit score and net worth, the better your chances of getting a lower rate.
- Economic conditions. Broader market conditions such as Federal Reserve policy, inflation trends and market demand for commercial lending all impact interest rates for commercial mortgages.
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- 1. Federal Reserve Bank of New York. Effective Federal Funds Rate. Accessed May 8, 2026.
- 2. Federal Reserve. Assets and Liabilities of Commercial Banks in the United States - H.8. Accessed May 8, 2026.
