Commercial Real Estate Financing from Scotiaconnect

Commercial Real Estate Lending for Every Property Strategy

Scotiaconnect CRE financing covers owner-occupied buildings, multi-tenant investment properties, and ground-up construction — each loan structured around the property type, borrower experience, and income approach that the asset class demands.

Owner-occupied commercial real estate is the most common Scotiaconnect CRE loan category. If your business occupies at least 51% of the building square footage, the loan qualifies for owner-occupied pricing — typically a margin 50 to 100 basis points lower than investment-property rates and a down payment requirement starting at 20%. Owner-occupied borrowers benefit from Scotiaconnect's ability to underwrite the operating business and the real estate together. A dental practice buying its office condo, a manufacturer purchasing its production facility, or a law firm acquiring a downtown floor — in each case Scotiaconnect reviews the business financials, the property appraisal, and the lease-equivalent expense to confirm the project makes sense as a single economic unit. Loan amounts for owner-occupied CRE range from $100,000 to $10,000,000 with fixed-rate terms available for 5, 7, 10, 15, and 25 years. Adjustable-rate options with initial fixed periods of 3, 5, or 7 years are also available and often preferred by borrowers planning to sell or refinance within the fixed window.

Investment property loans from Scotiaconnect cover retail centers, office buildings, industrial warehouses, and multi-family residential properties with five or more units. Underwriting for investment CRE relies primarily on the property's debt-service coverage ratio — Scotiaconnect typically looks for a DSCR of 1.25 or higher, meaning the property's net operating income exceeds the annual debt service by at least 25%. Down payments start at 25% for well-located properties with strong rent rolls and climb to 30% or more for properties with higher vacancy, shorter remaining lease terms, or specialized-use buildings that would take longer to re-tenant. Scotiaconnect orders a full appraisal, a phase one environmental site assessment, and a property condition report on every investment-property loan. These reports are shared with the borrower as they arrive. There is no mystery about what the underwriters are reviewing. Investment-property borrowers also submit a current rent roll, trailing twelve-month operating statements, and the most recent property tax bill along with the loan application. Scotiaconnect may escrow for property taxes and insurance on investment loans, spreading those obligations into monthly payments rather than requiring the borrower to manage lump-sum due dates.

Construction and development lending through Scotiaconnect uses a construction-to-permanent structure. The bank approves the full project — land, hard costs, soft costs, contingency, and interest reserve — and funds are drawn against a line-item budget as work progresses. A third-party inspector verifies each draw request before Scotiaconnect releases funds. Interest during construction accrues only on the drawn balance, not the full commitment. Once the certificate of occupancy is issued, the loan converts to a permanent mortgage with amortization beginning immediately on the total drawn amount. Scotiaconnect construction loans require a down payment of 20% to 35% depending on the project type — owner-occupied construction typically at the lower end, speculative development at the higher end — and the borrower must demonstrate relevant project experience. First-time developers may still qualify through SBA 504 construction financing, which provides a subordinate lien covering up to 40% of the project cost alongside a Scotiaconnect first mortgage, effectively reducing the borrower equity requirement to as low as 10%.

CRE Loan Type Comparison

Every Scotiaconnect commercial real estate loan type has distinct qualification criteria, down payment thresholds, and underwriting focus areas — the table below maps the differences at a glance.

The Scotiaconnect CRE Application Process

Scotiaconnect structures the commercial real estate application as a phased process — pre-qualification within two business days, then full underwriting with parallel third-party reports to keep the timeline moving.

The process begins with a pre-qualification step: submit a brief summary of the property, the purchase price or project cost, and your business financials through the Scotiaconnect online portal. A CRE lending specialist reviews the summary and responds within two business days with a preliminary term sheet — rate range, term options, estimated down payment, and a list of the specific documents required for full underwriting. There is no commitment at this stage and no fee. If the preliminary terms work for you, Scotiaconnect issues a formal letter of intent and simultaneously orders the appraisal, environmental, and property condition reports. These reports typically arrive within two to three weeks. While the reports are being prepared, the underwriting team reviews your full application package, including business tax returns, personal financial statements, and for investment properties the rent roll and operating history. Scotiaconnect keeps the borrower informed at each milestone — appraisal ordered, appraisal received, underwriting review complete, final credit approval — through the online banking messaging system, so you are never left guessing where your loan stands.

For construction projects, the application process includes an additional phase: plan and budget review. Scotiaconnect requests the full set of construction drawings, the general contractor's qualifications and license documentation, a line-item construction budget, and the project timeline with milestones. The construction lending team reviews these alongside the appraisal and ensures the budget is realistic for the market and the contractor's track record. A contingency reserve of 5% to 10% of hard costs is built into the loan commitment so that modest scope changes do not require a re-approval cycle. Draw requests during construction are submitted through the Scotiaconnect portal, and inspection reports are uploaded to the same thread, creating a complete audit trail for the borrower, the contractor, and the bank.

Refinancing Existing Commercial Property

Scotiaconnect CRE refinancing allows property owners to access equity, lower their rate, or extend their term — while keeping the lending relationship with a single institution that knows the asset.

If you own commercial real estate financed elsewhere, Scotiaconnect can refinance the existing debt under current market terms. Cash-out refinancing is available up to 75% loan-to-value on owner-occupied properties and typically 65% to 70% on investment properties — the extracted equity can be used for business expansion, acquiring additional property, or simply strengthening the company's balance sheet. Scotiaconnect refinancing generally requires the same documentation package as a purchase loan, plus the existing loan statement showing the current payoff amount and payment history. Rate-and-term refinances with no cash out may qualify for streamlined processing if the property has been owned for at least two years and the borrower's financial profile remains substantially unchanged from the original underwriting.