Commercial Real Estate Loans in Minnesota

Security Bank & Trust Co. has lent against Minnesota real estate since 1935 and holds over 300 one to four family rental properties in its own portfolio, alongside commercial, retail, industrial and multifamily loans. We are a locally owned community bank with 21 locations across the Twin Cities metro and Greater Minnesota, and every credit decision is made here. Investors typically compare community banks against national lenders and mortgage brokers; the practical difference is that a portfolio lender can set terms to fit the property, and can keep lending to you after the fourth or tenth property.

Yes. We finance apartment buildings, retail, office and industrial property throughout the Minneapolis and St. Paul metro area, including downtown office buildings and student housing near the University of Minnesota and the University of St. Thomas. We also lend across Greater Minnesota, where our branch network is concentrated. Because our lenders are local, they can visit the property rather than underwrite it from a spreadsheet.

There is no fixed property count. Conventional secondary-market mortgages typically cap an individual investor at a set number of financed properties, and that ceiling is the point at which many investors first call a portfolio lender. Because we hold these loans ourselves rather than selling them, that cap does not apply. What governs how much we lend is your global cash flow, the performance of the properties you already own, and your overall leverage.

Yes, and most of our investor borrowers do. Holding property in a limited liability company or other entity is routine and we lend to entities regularly. Expect to sign a personal guarantee behind the entity, and expect us to underwrite both the entity and you individually. Bring the operating agreement and entity documents to the first meeting to save a round trip.

Owner-occupied means your business will operate out of the building. Those loans are underwritten primarily on your business's operating cash flow, with the real estate as collateral, and they may qualify for SBA 504 financing. Investment property is leased to tenants, so the loan is underwritten on the income the property produces, principally debt service coverage. The distinction affects advance rate, term options and which programs are available, so it is one of the first questions your lender will ask.

Coverage requirements vary by property type and market, and we do not publish a single threshold because a stabilized multi-tenant apartment building and a special-purpose single-tenant building are not the same risk. Lenders generally look for net operating income to exceed annual debt service with a margin for vacancy and capital repairs. In practice, coverage rather than purchase price is often what determines the maximum loan on an income property, so it is worth calculating before you make an offer.

Loan to value is set by market strength, property type, property condition and the financial strength of the guarantors. Stabilized, multi-tenant property in a strong market supports a higher advance rate than a vacant or special-purpose building. Amortization runs up to 25 years depending on loan to value, with maturities up to 25 years depending on amortization. Your lender can give you a working range on a first call and a specific number in a term sheet after review.

Yes. We finance apartment properties across the Twin Cities and Greater Minnesota, including acquisition, refinance and repositioning, and we understand student housing specifically, including by-the-bedroom leasing near the University of Minnesota and the University of St. Thomas. Student housing has its own occupancy cycle and turnover pattern, and underwriting that assumes a conventional apartment lease-up will get the property wrong.

No. SBA 504 and 7(a) both require that your business occupy the property, so they do not apply to property held purely for rental income. SBA 504 is an excellent fit for a business buying its own building, because it typically requires a lower down payment than conventional financing and fixes the rate on a portion of the debt for a long term. See our SBA loans page for how the programs work.

For a purchase: the purchase agreement, the rent roll and current leases, two to three years of operating statements on the property, two to three years of personal and entity tax returns, a current personal financial statement, and entity documents if you are borrowing through an LLC. For a refinance, the same package without the purchase agreement, plus your current loan documents. Your lender will confirm the list for your specific situation before you start gathering.

The variable is almost always the third-party work rather than the credit decision. A straightforward purchase with a current appraisal and clean title moves quickly. Appraisal turnaround, environmental review where the property history calls for it, and survey or title issues are what extend a timeline. Because our credit decisions are made in Minnesota, we can usually tell you where the deal stands the same week you ask, and your lender will give you a realistic date rather than the best possible one.

Yes. Acquisition, remodel and value-add lending is a regular part of what we do, on both commercial property and one to four family rentals. On a value-add deal we underwrite to your business plan as well as to the property's current numbers, so bring the scope of work, the budget and your contractor. If you are building from the ground up rather than renovating, that is a commercial construction loan instead.