Commercial Loans Los Angeles
Los Angeles is the largest commercial real estate market in the western United States. From the downtown office towers and Arts District mixed-use to the industrial corridor along the 710 freeway and the retail nodes of the San Fernando Valley, commercial property in LA spans every asset class, price range, and neighborhood profile. I work with LA-based investors, business owners, and developers on commercial mortgage financing across all these property types — office, retail, industrial, multifamily/mixed-use, and owner-occupied commercial buildings throughout LA County.
I’m Michael DiVita, owner of DiVita Home Finance. Licensed in California since 2007. LA is one of the most competitive commercial lending markets in the country, and I work with the full range of lender types — conventional commercial banks, CMBS programs, life companies, debt funds, SBA Preferred Lenders, and bridge lenders — to match the right capital to each specific deal.
LA Commercial Real Estate — A Market Overview
LA’s commercial market is defined by its geographic fragmentation. There’s no single downtown that dominates; instead, the market has multiple distinct nodes each with their own supply/demand dynamics. The Westside (Century City, Santa Monica, Culver City) hosts tech, entertainment, and media companies and commands some of the highest office rents in California. Downtown LA has seen both significant development and ongoing challenges with office vacancy. The South Bay (El Segundo, Manhattan Beach, Torrance) has a strong defense/aerospace and logistics tenant base. The San Fernando Valley is the largest suburban market in the county.
Industrial in LA County is extremely constrained — infill locations along the 710 corridor (Vernon, Maywood, Commerce) have very low vacancy and high rents. The San Gabriel Valley and Santa Clarita corridor offer more available industrial product at slightly lower rents. Retail follows population density and household income, with Beverly Hills and the Westside commanding premium rents and central Valley strip centers serving a middle-market base.
LA Commercial Loan Programs
- Conventional Commercial Mortgage — for stabilized LA properties. 65–75% LTV, DSCR 1.20x+. Competitive rates from banks and non-bank lenders active across LA County.
- CMBS Loans — for larger assets ($3M+ loan). Non-recourse, fixed rate, interest-only available. Best for stabilized multi-tenant properties with strong rent rolls.
- SBA 504 Loans — for owner-occupied LA commercial. 10% down, 25-year amortization. Excellent capital efficiency for businesses buying their space in high-cost LA markets.
- Life Company Loans — for high-quality Class A assets (Century City office, West Hollywood mixed-use). Best long-term fixed rates for top-tier LA properties.
- Bridge Loans — for value-add and transitional LA assets. 12–36 months, interest-only, 65–75% LTV.
- Hard Money / Private Lending — for complex, time-sensitive, or non-conforming LA deals.
LA Commercial Loan FAQ
What are realistic loan terms for a small commercial building in Los Angeles right now?
For a stabilized small commercial building in LA — say a mixed-use retail/residential on a major corridor or a small office building in the Valley — a conventional commercial loan will typically offer 65–70% LTV, DSCR minimum around 1.20–1.25x, 5–10 year fixed rate with 25–30 year amortization. Rates are market-driven and I’ll quote you current rates when you call. The challenge in LA is that many smaller commercial properties have long-term tenants paying below-market rents, which depresses NOI and limits loan sizing. We can still finance these properties, but the loan amount is driven by actual current NOI, not market rent potential. Call me with the property’s rent roll and I’ll run the DSCR analysis.
I own a business in LA and want to buy my commercial space instead of leasing. What are my options?
For owner-occupied commercial in LA, SBA 504 is usually the best answer: 10% down on a building that might cost $1.5M–$5M+ is far more capital-efficient than the 25–30% conventional commercial requires. A business owner buying a $2M property puts $200K down with SBA 504 versus $500K–$600K with conventional. The 25-year amortization and fixed rate on the SBA tranche creates a predictable, manageable payment. Processing takes 45–90 days. Conventional commercial closes faster if you can swing the larger down payment. I’ll walk you through both options and show you the actual payment comparison for your specific property and purchase price.
Can I get a commercial loan for an LA property with a cannabis tenant?
Cannabis tenants are a significant underwriting challenge for commercial loans in California. Federally chartered banks (which includes most conventional commercial lenders) cannot lend on properties with cannabis tenants because cannabis remains federally illegal — even in California where it’s state-legal. This leaves you with non-bank portfolio lenders, private/hard money, and some debt funds that are willing to lend on cannabis-tenanted properties. These alternatives exist but come with higher rates and more restrictive terms than conventional commercial. If your LA property has a cannabis tenant or you’re acquiring one, call me directly — I work with several lenders who will look at these deals and I can give you realistic terms based on the specific property.
Talk to Michael Directly
DiVita Home Finance | Marin County, CA | Licensed since 2007. DRE #01818285 | NMLS #323700.
💬 Text: (310) 849-9124
