By Alfred Testa
Regardless of whether commercial property owners have one or multiple properties, are looking to acquire new property, or renovate or develop new space, financing is always an integral part of the process.
In Saratoga Springs, continued growth downtown is bringing more residential development and mixed-use spaces. In Glens Falls, old spaces are becoming new again as a resurgence in millennials is driving new demand.
Whether your focus is on multi-family housing, self-storage, mixed-used properties, office space or retail, the opportunities for commercial property acquisition remain strong. But without a good relationship with a commercial banker, getting through the process can be very challenging.
Taking time to ask questions up front could help you avoid three of the most common frustrations when it comes to commercial financing.
Local offices and local lenders
It’s important to have a banking partner that understands the market and can move through the process quickly, whether funding at closing or construction over time. Locally, NBT Bank believes a reasonable expectation is to be able to meet within a few days of the commercial property owner’s outreach to a loan officer. After that initial meeting, the application process begins, followed by bank underwriting, and ultimately a commitment letter once the bank approves the loan.
Scheduling meetings and availability
You will want a commercial banker who can be available for meetings with you and members of your team. You will want to work with a lending partner who is available in person, by phone and by email. Local community banks often have more branches and staff available to customers. In this situation, a presence and experience in your market are key.
A local bank with community partners and contacts may also be able to provide additional resources that can help support your project. Make sure you know in advance if you’re going to have to work around the bank’s schedule, or if they are going to work around yours.
Breakdowns in communication
Have you ever had a communication breakdown in the midst of a project? Whether you couldn’t get a hold of the person you needed to, weren’t sure who to contact, or felt out of the loop on the financing details – communication and responsiveness in commercial real estate projects are essential.
You need to know the details of where you are in the lending process and be able to access someone when you have questions or need an update.
Look for a bank that offers a dedicated relationship manager who serves as your point of contact from application until closing or project completion. A relationship manager is often part of a commercial banking team, so if he/she is at a meeting or out of the office when you call, you can still get the answer you need right away from another team member.
Ask questions about the staff and communication flow when you’re evaluating lenders to try to avoid breakdowns in communication.
Testa is a vice president and senior commercial banking relationship manager for NBT Bank.