Compare Warehouse Loans

Step into commercial real estate with a warehouse loan.

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If you're looking to purchase a warehouse as an investment or for your own business's use, you'll need finance. Here's what you need to know.

Warehouses have a lot in common, but there can be some major differences that differentiate one warehouse from another. While all warehouses tend to be constructed from steel or industrial concrete in a no-frills box shape, typically without windows, it is the facilities inside the warehouse and its intended use that can set one warehouse apart from another.

Some warehouses double as retail stores (like large Supré outlets) while others are an inventive mix of warehouse, retail and showroom (such as IKEA). Some warehouses are mostly automated and can move large amounts of stock with minimal staff, while other warehouses are purpose-built and refrigerated or climate controlled to handle perishable or sensitive stock such as computer products, flowers, fresh produce or frozen items.

Warehouses have long been popular commercial real estate choices for investors, attracting long leases and stable rental income. However, not all warehouses are alike, and savvy investors know what to look for when purchasing a warehouse. Read on to find out how warehouse loans work and how to increase your chances of having your warehouse loan application approved.

Compare loans suitable for purchasing a warehouse

Name Product Min. Loan Amount Max. Loan Amount Loan Term Upfront Fee Filter Values
Moula Business Loan
1 to 2 years
2% Establishment fee
A loan of up to $250,000 that can be approved and funded within 24 hours. Available to businesses with 6+ months operating history and $5,000+ monthly sales.
Swoop Finance Business Loan
1 to 30 years
Depending on your loan contract
Apply online and borrow between $1,000 and $100,000,000. Options for good and bad credit borrowers.
ebroker Business Loan
1 month to 30 years
$0 application fee
Small business loans available between $5,000 and $5,000,000. Get access to 70+ non-bank lenders on this independent platform.
Lumi Unsecured Business Loan
3 months to 3 years
2.5% establishment fee
Apply for up to $300,000 from Lumi and benefit from short loan terms, no early repayment fees and once approved receive your funds in just one business day.
Max Funding Unsecured Business Loan
1 month to 1 year
$0 application fee
An unsecured business loan from $3,000 that offers convenient pre-approval and no early repayment fees.
Valiant Finance Business Loan Broker
3 months to 5 years
$0 application fee
A Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 70 lenders. Loans between $5,000 and $1 million are available. Request a call – your loan can be funded in 1 business day.
OnDeck Business Loans
6 months to 2 years
3% of loan amount
Apply for up to $250,000 and receive your approved funds in one business day. Minimum annual turnover of $100,000 and 1 year of trading history required.
Octet Trade Finance
1 month to 2 years
Transaction fee 2.5%
Access a line of credit to pay suppliers in over 65 countries. Borrow from $200,000 up to $7 million.
Prospa Business Loan
3 months to 3 years
3% origination fee
Small business loans are available from $5,000 - $300,000 on terms of up to 3 years. At least six months trading history and a monthly turnover from $6,000 is necessary.
Heritage Bank Fully Drawn Business Loan
No maximum amount
1 to 25 years
Application fee is available upon application
Get access to a loan from $20,000 with no maximum limit with Heritage Bank. Loans can be secured by residential and non-residential property and have terms of up to 25 years.
Westpac Business Loan
1 to 30 years
$0 application fee
Purchase a new vehicle, equipment or support your cash flow with a business finance solution from Westpac.
ANZ Secured Business Loan
Up to 15 years
Benefit from a low rate when you secure this loan with property and/or business assets. Loans from $10,000 available.
ANZ Unsecured Business Loan
Up to 15 years
Apply for a loan from $10,000 with no security required and benefit from flexible repayment terms.

Compare up to 4 providers

Why are you buying a warehouse?

A warehouse as a freehold investment

A warehouse can be an excellent addition to a commercial real estate investment portfolio, providing a low-risk source of regular, stable rental income. Built with industrial strength and a no-frills design, warehouses are largely immune to the risk of damage and wear and tear. In fact, the biggest risk an investor takes when purchasing a warehouse is experiencing periods of low demand that could see the warehouse empty and not producing an income.

This risk is somewhat mitigated by the fact that warehouse leases tend to be stable and long term. Even if a warehouse is empty while you look for a new tenant, once a lease agreement is in place, it is likely to persist for some time – at least five years, but often as long as 10 years per lease term with options to renew.

Tenants and lease agreements

As with the majority of commercial real estate purchased for investment purposes only, the strength of your application will depend to a large extent on the tenant. If the warehouse is currently tenanted, the lender will need to see evidence that the tenant is in a good financial position, has signed a long-term lease and has provided an indication that they intend to stay on in the warehouse in the future.

Be prepared to provide a copy of the lease agreement to the lender since they will want to know that the tenant has complied with their obligations under the lease agreement, and that automatic rent increases in line with inflation are included in the agreement. Lenders will usually require financial documentation for the tenant's business as well as a copy of the business plan. Be wary of a tenant who is unwilling to provide this information as it could suggest business mismanagement or financial difficulties.

Running your own business from a warehouse

For many people, the decision to purchase a warehouse is a viable alternative to continuing to lease a warehouse for business purposes. When making this decision, a lot will come down to running the numbers and determining the financial viability of making business loan repayments rather than rent payments. It is always a good idea to obtain independent financial advice when making this kind of assessment to ensure that every financial element is included.

Other considerations will include potential tax benefits including deductions made on interest payments on the business loan, along with any plans you may have to renovate a warehouse to suit your business's individual needs. It can often make more financial sense to spend money renovating real estate that you own – thereby increasing its market value – than improving a rental property owned by someone else.

Choosing the best warehouse for your needs

Location and zoning

While location is not as vital when purchasing a warehouse as it is for a retail store that relies on foot traffic, it is still an important consideration to make when choosing a warehouse to purchase. This is particularly true if the warehouse does have a retail aspect to it, rather than solely picking and packing orders and moving stock.

If you are purchasing a warehouse as an investment, warehouse occupancy rates in the area will give you a good indication as to how long it may take to find a new tenant should the need arise.

Zoning is another important consideration since zoning restrictions can limit or even prohibit you from running specific types of businesses from the warehouse. Obtain legal advice or make your own enquiries with the local council to find out the zoning of the local area, and determine whether this may restrict a particular type of business, such as one that relies on the use or storage of potentially hazardous or environmentally unfriendly materials or chemicals.

Finding finance to buy a warehouse

Standard loan terms

Loan terms offered for a warehouse loan will depend on a number of factors and can vary from lender to lender. With any type of commercial loan, it is always important to compare your options and choose a vendor that best suits your individual circumstances before submitting an application.

As a guide, the following loan terms could apply to a warehouse loan:

  • Loan amount. You can get a loan amount of up to 50% of the value of the warehouse for a specialised or purpose-built warehouse, up to 70% for a standard warehouse or up to 100% if you offer residential property as additional security for the business loan.
  • Loan Term. You can typically get a loan term of 20 years or a loan term up to 30 years if you use residential property as security.
  • Interest rates. These will vary between lenders and will depend on the strength of your application and the value of the warehouse itself. You may get an interest rate discount if you use residential property to secure the loan.

Getting approved for a warehouse loan

The key to getting approval for a warehouse loan is to put together a comprehensive application that highlights your strength as a borrower and your ability to meet the loan repayments.

After that, the business loan application process will vary depending on your proposed use of the warehouse.

  • If purchasing the warehouse as an investment, the lender's primary consideration will be the stability of the current leasing situation and the financial strength of the tenants.
  • If purchasing the warehouse to run your own business, the lender's focus will shift to your business plan and your skills, expertise and experience in the industry.

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