Strip Mall Loans
Smart financing for neighborhood retail and multi-tenant strip centers
What is a strip mall loan?
A strip mall loan is a commercial real estate loan secured by a multi-tenant retail property, usually comprising several storefronts within a single complex. Lenders evaluate the property’s rental income, tenant mix, lease terms, location, and overall market strength, not just the borrower’s personal credit. Strip mall financing can be used to purchase, refinance, cash out equity, or renovate neighborhood retail centers and small shopping plazas.
What borrowers typically qualify for
Typical LTVs
Most strip mall loans offer 60%–75% LTV. Higher leverage may be available for strong tenant mixes and prime locations.
DSCR requirements
We look for a DSCR of 1.20–1.35. Experienced ownership or strong lease properties may qualify with lower coverage.
Credit guidelines
An above-680 credit score is required. Lower credit profiles may qualify with higher equity, solid cash flow, or additional reserves.
Borrower qualifications
We look for clean operating history, realistic income projections, stable tenant performance, and a clear ownership.
What makes strip malls unique to us
Tenant mix matters
Strip malls depend on a balance of service-based tenants, anchor stores, and long-term leases.
Local market exposure
Neighborhood retail performance can shift based on traffic patterns, population changes, and nearby competition.
Vacancy sensitivity
Retail vacancies can impact cash flow quickly, so we evaluate backfill potential and market demand carefully.
Location & visibility
Access, signage, parking, and daily traffic counts play a major role in valuation and financing confidence.
Documents required for Strip Mall Loans
Executive summary or loan request package
Purchase agreement (for acquisitions)
Current rent roll and copies of all leases
Last 2–3 years of property operating statements
Tenant sales data (when available)
Market rent comparables and local retail analysis
Property survey and environmental Phase I
Appraisal or appraisal ordered through us
Borrower's personal and business tax returns (2–3 years)
Entity documents (LLC operating agreement, K-1s, ID verification)
Proof of insurance and property condition reports
What loan terms can borrowers expect?
Interest rates
Rates depend on market conditions. We source competitive fixed and floating options that align with your goals.
Amortization
Most strip mall mortgages offer 20–30 year amortization, with refinance options often extending up to 30 years.
Term length
Typical loan terms range from 5 to 10+ years, depending on the financing program and property stability.
Recourse vs. non-recourse
Many commercial strip mall loans qualify for non-recourse terms when supported by strong tenancy.
Prepayment
Long-term fixed loans may include yield maintenance, defeasance, or step-down penalties.
Closing timeline
Most strip mall financings close within 30–60 days. Complex tenant structures or renovations may extend timelines.
Eligible vs ineligible properties
Neighborhood strip malls with multiple tenants
Retail centers anchored by grocery, pharmacy, or service tenants
Mixed-use retail with high retail income
Value-add strip malls with clear improvement plans
Properties with high vacancy and no leasing plan
Retail centers with short-term or unstable tenants
Title or zoning problems that cannot be resolved
Centers with excessive exposure to declining retail categories
Simple step-by-step loan process
FAQ (Frequently Asked Questions)
How much down payment is required for a strip mall?
Most strip mall loans require 25%–40% equity, depending on tenant mix, location, and loan structure.
Can I finance a partially vacant strip mall?
Yes. Rize Mortgage evaluates leasing plans, market demand, and sponsor experience. Lower LTV or reserves may be required.
Are anchor tenants required?
Not always. While anchor tenants help, well-diversified service-based strip malls can still qualify for strong financing.
Do strip mall loans require personal guarantees?
Some strip mall loans require personal guarantees. However, non-recourse options are available for stabilized properties with strong cash flow.
How long does the process take?
Most transactions close within 30–60 days, depending on due diligence and tenant review.
Ready to start your strip mall loan?
At Rize Commercial, we help investors and owners secure the right strip mall financing with clear terms and expert guidance.