Last Updated: 29th December, 2022


We are only accepting applications for commercial property loans with a minimum loan size of $500,000, and a minimum deposit of 30%. We apologise for the inconvenience.

Is it a standard commercial property?

Showrooms or bulky goods stores usually attract longer lease terms compared to some other commercial properties.

They can be a great way to diversify your portfolio into commercial real estate but how do banks assess them when it comes to a showroom commercial loan?

Your chances of getting approved depend on location and zoning and whether the showroom is purpose-built or not.

How much can I borrow?

  • Freehold showroom: Borrow up to 70-75% of the property value or up 105% of the property value using a residential property as security or with a guarantor.
  • Maximum loan term: 25 years.
  • Maximum interest only term: 5 years.
  • Loans over $5,000,000: Assessed on a case by case basis.
  • Running a business: A business plan is required showing cash flow and revenue forecasts.
  • Low doc options: In the form of Business Activity Statements (BAS) and business transaction statements.
  • Interest rate discounts: Depends on your application strength and negotiations by your mortgage broker.

We can give you an indicative funding proposal!

All you need to provide is tell about your situation, provide some basic financials and we can come to you with some lender recommendations.

Call us on 1300 889 743 or complete our free assessment form to find out why we’re commercial loan specialists.

How can a commercial mortgage broker help?

Commercial mortgage brokers are specialists in commercial and business credit policy.

They are someone you want to have your side when applying for a showroom commercial loan because getting approved is all about presenting a strong business case.

The bank or lender is asking themselves why they should lend to you and a good broker will address all of their concerns and questions in your application.

We can help you to borrow up to maximum Loan to Value Ratio (LVR) for the showroom, bulky goods store or warehouse that you’re considering buying.

We also have the relationships in place to negotiate sharp pricing and discounted interest rates.

With almost 40 lenders on our panel, we can help you qualify for a showroom commercial loan that’s right for you.

How will the bank assess the property?

Purpose-built or an easy conversion

Most lenders prefer lending against standard commercial properties such as warehouses, factories, retail shops and office units.

Luckily, showrooms are largely considered to be in the same category as warehouses.

In saying that, if it’s purpose-built, such as a car showroom or one with specialty-built loading docks, you’ll have a harder time getting approved or borrowing the amount you need.

That’s because it limits the potential market of buyers and represents are a large risk to the bank if they had to sell the property in the event of default.

A mixed use showroom means the property can be used for commercial, industrial, retail or residential purposes.


Showrooms are for businesses looking to attract either retail customers or wholesale buyers.

Because of that, banks prefer businesses that are:

  • Located in metro city locations.
  • Close to main highways and motorways.
  • Located near a main shopping or commercial district.

Banks have a lot of property market data so they will be looking at the vacancy rates in the area for the property that you’re buying.


Although it goes hand in hand with location, zoning can legally restrict the type of businesses that can operate in the showroom.

Zoning will not only vary from state to state but from council to council.

For example, some industrial zones will only allow you to store certain types of material, specifically, items that won’t compromise the long-term use of the land.

What may be considered a high impact industrial zone is when a potential tenant is planning to store chemicals like oil or fertilisers.

As a general rule, if you’re planning to buy a freehold showroom with an existing tenant that’s involved in activities that may affect the local environment, lenders want to steer clear.

Please call us on 1300 889 743 or complete our free assessment form and we can let you know if you qualify for a showroom commercial loan.

What will the lender accept as security?

Lenders will lend against a maximum of 75% of the showroom’s property value which means you need come with at least 25-30% as a deposit.

This includes the cost of completing purchase including conveyancing fees, legal costs and around 10% to cover the Goods and Services Tax (GST) that applies when buying commercial real estate.

However, if you have sufficient equity in your property, you can use as security to cover the purchasing costs and your deposit.

Apart from the deposit and property security, most lenders will also need you to provide:

  • A General Security Agreement (GSA) over the rights and undertakings in respect of all security property.
  • Directors’/shareholders’ guarantees.

How will my personal situation be assessed?

A commercial loan application comes down to building a stronger picture of your character.

The first thing they want to know is that you have a good cash flow and a stable source of income.

As a general rule, this means your income should be at least 1.1 to 1.5 times the proposed interest expenses. This is known as the ‘serviceability ratio’.

However, you don’t necessarily need a clean credit history to get approved. If you can provide detailed explanations of how you resolved such credit issues as defaults, there are lenders that will consider your showroom commercial loan application.

What if I’m planning to run my own business?

If you’re looking to run your own retail or commercial business from the showroom, there are some lenders that will consider this:

  • You need to have experience in running a similar-sized bulky goods showroom in a similar industry.
  • You need to have a strong Debt-Service Coverage Ratio and strong cash flow to handle weak business periods.
  • You a business plan that details cash flow forecasts, market competition and your business model.
  • 2 years financials or tax assessment notices.
  • If you’re currently self-employed or running a business, the lender will want to full financials and turnover figures for the past 2-3 years.
  • If you’re currently self-employed or running a business, the lender will want to full financials and turnover figures for the past 2-3 years.

Our brokers are specialists in showroom commercial loans and we can help you prepare your application to highlight your strengths as a borrower so you have a better chance of getting approved the first time around.

Can I buy an untenanted showroom and develop?

You may still be able to buy the property but the bank will be relying more on the fundamentals of the property’s location, the zoning and the strength of your financial position.

As a general rule, banks don’t like speculative investing particular when it comes to vacant and untenanted properties.

However, if the property is located in a metro location with strong vacancy rates then there are some lenders that will consider your development plans.

Check out the commercial development loan page for more information.

What should I look for in a showroom?

The following types of characteristics and features will help to attract customers which means you’ll open up the market to more tenants.

  • Being close major highways and motorways attracts customers but also makes it easier for distributors to deliver stock.
  • Allocated parking or close to parking.
  • Signage opportunities.
  • Look for showrooms with a so-called “wide purpose clause” that allows it to be used for any number of purposes including a retail, commercial or recreation.
  • Street frontage with good visibility to foot traffic and cars.
  • Open floor area and that can be easily converted and subdivided.
  • Rear roller door access wide enough for truck loading.
  • High-clearance ceiling.
  • Having an office in the showroom can be an attractive feature to some tenants.
  • Security features like mechanical operating doors, security fences, strong doors, surveillance cameras and alarm systems are highly sought after although they’ll need regular upkeep.

What’s the difference between a warehouse and a showroom?

A warehouse is typically used for storage purposes and usually zoned industrial.

Many businesses make the decision to rent warehouses as a result of business growth. Their inventory simply becomes too large to keep in-store or in their office.

A showroom or bulky goods store is zoned commercial or mixed use and is designed specifically for businesses that sell to retail consumers and wholesale buyers.

Showrooms come in various shapes and sizes but are typically under 5,000 square metres.

It’s important to be aware that the larger the floor area, the more conservative some lenders can become in approving finance.

Example of showrooms include:

  • Car dealership showroom.
  • Furniture showroom.
  • Appliances and whitegoods showroom.
  • Carpet showroom.

What should I consider with the lease term?

As far as a commercial real estate goes, there is a lot of investment potential with showrooms.

First off, tenants tend to sign on for long lease terms (usually 3,5 or 10 years) which gives you more certainty of stable rental income.

Of course, larger showrooms can be harder to lease than smaller showrooms and will cost a lot more to hold.

You’re also not likely going to make as much as money with a showroom compared to other types of commercial properties.

However, if you get a pre-approved and put down a deposit quick enough, you may score a blue chip tenant.

With the lease arrangement itself, be sure it spells out who is responsible for the property’s ongoing expenses.

Normally, the tenant pays all outgoings including council rates, water and electricity.

They should also “make good” any physical changes to the premises.

It’s important to speak to a solicitor that specialises in commercial properties, such as showrooms, when negotiating the Contract of Sale and Heads of Agreement.

Do you qualify for a showroom commercial loan?

Speak with one of our commercial loan experts on 1300 889 743 or complete our online enquiry form and will get back to you to discuss your situation.