Retail Property Finance
Retail Property Finance UK
Retail property finance covers the purchase, refinance, and development of shops, retail units, supermarkets, retail parks, and high-street commercial premises across the UK. The retail sector has undergone significant structural change in recent years, creating both challenges for lenders assessing traditional high-street assets and opportunities for investors acquiring at value in a repriced market. Platinum Global Bridging Finance arranges retail property mortgages and bridging loans from £150,000 to £150m+. No broker fee on facilities of £500,000 or above.
What Is Retail Property Finance?
Retail property finance is commercial mortgage lending secured against property used for retail purposes — shops, supermarkets, convenience stores, showrooms, retail parks, and similar assets. The loan can be on an owner-occupied basis, where the retailer purchases its own trading premises, or an investment basis, where an investor acquires a retail property let to one or more tenants.
The retail sector requires careful lender selection. High-street banks have significantly reduced appetite for traditional retail investment since 2020, particularly for secondary and tertiary locations. Specialist commercial lenders and challenger banks have filled much of this gap, with more flexible underwriting criteria and genuine appetite for well-structured retail lending cases.
Types of Retail Property We Finance
- High-street shops and retail units — single-let and parades
- Convenience stores and off-licences — including those with a residential flat above (see semi-commercial finance)
- Supermarkets and food stores — particularly net-leased single-let investments
- Retail parks and out-of-town retail
- Showrooms — motor trade, furniture, and specialist retail
- Drive-through and fast-food units
- Pharmacy, optician, and healthcare retail premises
Owner-Occupied Retail Finance
Retailers purchasing their own trading premises are assessed on the trading performance of the business — turnover, adjusted net profit, and debt service capacity. This approach follows the same principles as any owner-occupied commercial mortgage. Established retailers with a multi-year trading record and demonstrable profitability are well-served by this market. New or early-stage businesses are more challenging but achievable with specialist lenders who understand sector dynamics.
Retail Investment Finance
Retail investment mortgages are assessed on the rental income and tenant covenant quality, following the same DSCR framework as other commercial investment mortgages. Key lender considerations for retail investment include:
- Tenant covenant strength: A national retailer or supermarket chain on a long FRI lease is assessed very differently from an independent trader on a short lease.
- Lease length and break clauses: Unexpired lease terms and break clause positions significantly affect lender appetite and maximum LTV.
- Location: Prime high-street and out-of-town retail attracts better terms than secondary or tertiary locations with high vacancy rates.
- Asset quality and EPC: Lenders increasingly require EPC information and factor energy performance into their assessment.
Lending Criteria for Retail Property Finance
| Parameter | Typical Range |
|---|---|
| Loan size | £150,000 to £150m+ |
| LTV (prime retail) | Up to 70% |
| LTV (secondary retail) | Up to 60% |
| Term | 3 to 25 years |
| Rate (2026) | 6.0% to 9.0% pa |
| DSCR (investment) | 125% to 150% of interest payment |
Retail Bridging Loans
For auction purchases, vacant retail units requiring refurbishment, or cases where speed is required, a retail bridging loan provides short-term funding while the long-term mortgage is arranged. We regularly structure bridge-to-mortgage transactions for retail investors — the bridge funds the acquisition and any refurbishment, with the commercial mortgage arranged once the unit is let and income-producing.
Frequently Asked Questions
Can I get a retail mortgage for a vacant shop?
Vacant retail units are difficult to mortgage conventionally. A retail bridging loan is more appropriate for vacant acquisitions, with a commercial mortgage arranged once the unit is tenanted.
What LTV is available for retail investment?
Prime retail with strong covenants on long leases can achieve 65% to 70% LTV. Secondary and tertiary retail typically attracts 55% to 60% LTV. The specific location, tenant, and lease terms will determine the achievable LTV.
Are retail mortgages regulated?
Pure retail commercial mortgages are unregulated. Where the retail property includes a residential flat above (mixed-use), the loan may become regulated depending on the residential proportion — see our semi-commercial mortgage page.
Does Platinum Global charge a broker fee?
No broker fee on facilities of £500,000 or above.
Our Commercial Property Finance Solutions
About Us
Platinum Global Bridging Finance is a distinguished high-net-worth finance broker. We specialize in providing tailored financial solutions, including Property Bridging Finance, Development Finance, Single Stock Loans, Margin Stock Loan, Crypto Finance, Crypto Backed Loans and Commercial Property Finance tailored to meet the diverse needs of our clientele seeking robust financial lending solutions.
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