Introduction
Boston's commercial real estate market offers sophisticated investors diverse opportunities across office buildings, retail centers, industrial properties, and mixed-use developments. As one of the nation's leading innovation hubs, Boston commands premium rents for well-located commercial properties, while ongoing urban revitalization creates value-add opportunities in emerging neighborhoods. However, commercial real estate transactions often involve complex financing challenges that traditional lenders struggle to address, from non-stabilized assets to time-sensitive acquisitions requiring rapid closings.
Hard money lending provides commercial real estate investors with the specialized financing tools needed to execute sophisticated investment strategies in Boston's competitive market. Whether you're acquiring a distressed office building in the Financial District, repositioning retail space in Back Bay, or developing ground-up commercial projects in the Seaport, private hard money loans offer the flexibility, speed, and creative structuring that institutional lenders cannot match. Our Boston-based commercial lending team brings deep market knowledge and transaction experience to every deal, ensuring your financing aligns with your investment objectives and market realities.
Applications
Commercial real estate investors utilize hard money financing across a spectrum of transaction types and investment strategies. Acquisition financing represents the most common application, enabling investors to capitalize on time-sensitive opportunities and distressed sales. Boston's commercial market frequently presents off-market deals, foreclosure auctions, and distressed assets that require immediate cash offers or rapid closings. Hard money acquisition loans provide the certainty and speed needed to secure these opportunities, often closing in 7-14 days while traditional lenders require 60-90 days.
Value-add and repositioning projects are ideally suited for hard money construction and renovation financing. Many Boston commercial properties, particularly older office buildings and retail centers, require substantial capital improvements to achieve market rents and tenant quality. Hard money renovation loans fund tenant improvements, common area upgrades, façade improvements, building system replacements, and ADA compliance work. Interest reserves accommodate the renovation period before stabilized cash flow is achieved, and streamlined draw processes keep contractors paid promptly.
Bridge financing helps commercial investors navigate timing mismatches between acquisition and permanent financing. Boston investors frequently use hard money bridge loans to acquire properties before securing long-term financing, particularly for properties requiring stabilization or lease-up. These bridge loans provide the capital needed to execute business plans and achieve the metrics required for permanent financing, typically refinancing into conventional commercial mortgages once the property is stabilized.
Cash-out refinancing through hard money lending allows commercial investors to unlock equity for portfolio growth. Boston's commercial real estate appreciation has created substantial equity for long-term property owners. Hard money cash-out loans provide capital for additional acquisitions, partner buyouts, or capital improvements without the extensive documentation and personal guarantees required by traditional lenders. This approach is particularly valuable for investors with multiple properties or complex ownership structures.
Ground-up commercial development and major redevelopment projects benefit from hard money construction financing. Boston's ongoing urban growth has created opportunities for new office buildings, retail centers, and mixed-use developments, particularly in the Seaport District, Allston/Brighton, and areas along the MBTA transit lines. Hard money construction loans accommodate these complex projects with flexible draw schedules, interest reserves, and loan structures aligned with construction milestones and leasing timelines.
Common Challenges
Commercial real estate investors in Boston face distinct financing challenges that hard money lending addresses effectively. Traditional commercial lenders typically require extensive documentation including three years of operating history, audited financial statements, and detailed tenant lease files. For non-stabilized properties or recent acquisitions, this historical data may not exist, creating a financing gap that hard money bridge loans fill perfectly.
Tenant rollover and vacancy risk creates uncertainty that traditional lenders often avoid. Boston's commercial market experiences tenant turnover as companies expand, contract, or relocate. Properties with significant lease expirations or vacancy may not qualify for conventional financing despite strong underlying real estate fundamentals. Hard money lenders evaluate the property's potential rather than current cash flow, providing financing based on market rents and the borrower's ability to execute a leasing strategy.
Our Approach
Our commercial real estate hard money lending approach combines institutional-grade underwriting with private capital flexibility. We evaluate commercial loan applications based on property fundamentals, market dynamics, and borrower experience rather than rigid debt service coverage ratios or personal credit metrics. This asset-based approach allows us to fund complex commercial transactions that traditional lenders decline while maintaining disciplined risk management.
We structure commercial hard money loans with terms from 6 to 36 months, interest rates between 10.5% and 14.5%, and loan-to-value ratios up to 70% for stabilized properties and 60% for value-add or development projects. Interest-only payments preserve cash flow during investment periods, and we can incorporate interest reserves for properties undergoing renovation or lease-up. Our draw administration for construction loans is designed for efficiency, with inspections and funding typically completed within 48-72 hours of request.
Related Services
Service Areas
Boston's commercial real estate market spans established districts and emerging neighborhoods, each with distinct characteristics and opportunities. Our commercial lending experience covers the Financial District's Class A office towers, Back Bay's premium retail corridors, the Seaport District's innovation hub development, Cambridge's Kendall Square biotech cluster, and revitalizing neighborhoods like the South End, Jamaica Plain, and Somerville's Assembly Square. We understand the unique demand drivers, tenant profiles, and market dynamics across these submarkets, enabling us to structure commercial loans aligned with local conditions.
Frequently Asked Questions
What types of commercial properties do you finance in Boston?
We provide hard money financing for all major commercial property types including office buildings, retail centers, shopping plazas, industrial warehouses, self-storage facilities, medical office buildings, and mixed-use properties. Within Boston's market, we finance properties ranging from single-tenant retail buildings and small office properties to multi-tenant office buildings and neighborhood shopping centers. We also finance specialized commercial properties such as lab space, flex buildings, and adaptive reuse projects converting former industrial or institutional buildings to commercial use.
How do you underwrite commercial properties with vacancy or tenant issues?
We evaluate commercial properties based on market potential rather than solely current cash flow. Our underwriting analyzes comparable market rents in the submarket, the property's competitive position, and the borrower's business plan for addressing vacancy or tenant rollover. For value-add properties with significant vacancy, we structure loans with interest reserves covering the projected lease-up period and underwrite based on stabilized pro forma income. Our experience with Boston's commercial market allows us to distinguish between temporary challenges and fundamental property issues.
What documentation is required for commercial hard money loan approval?
While we require less documentation than traditional commercial lenders, we typically need the rent roll showing current tenants, lease terms, and rental rates; operating statements for the property if available; a summary of the borrower's commercial real estate experience; and details of the planned use of funds and exit strategy. For construction or renovation loans, we require contractor bids and a project timeline. Unlike banks, we do not require audited financial statements, personal tax returns, or extensive personal financial documentation, focusing instead on the property and the transaction.
Can you finance commercial properties needing significant renovation or repositioning?
Yes, we specialize in financing value-add commercial properties requiring renovation, repositioning, or lease-up. Our construction and renovation loans fund capital improvements, tenant improvements, and leasing costs, with interest reserves covering the period until stabilized cash flow is achieved. We have financed office building renovations in downtown Boston, retail repositioning projects in neighborhood shopping centers, and adaptive reuse conversions of former industrial buildings. These loans typically fund 60-65% of total project cost including renovation expenses.
What are typical loan terms for commercial hard money financing in Boston?
Our commercial hard money loans feature terms from 6 to 36 months, with 12 to 24 months being most common. Interest rates range from 10.5% to 14.5% depending on property type, location, leverage, and borrower experience. Loan-to-value ratios go up to 70% for stabilized properties and 60% for value-add or development projects. Interest-only payments are standard, and we offer flexible prepayment options. Loan amounts range from $250,000 for smaller commercial properties to $5 million or more for larger commercial buildings.