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BDC Commercial Real Estate Loans: How They Compare With a Commercial Mortgage
Quick answer: A BDC commercial real estate loan can finance up to 100% of the cost of premises your business will use, with an amortization of up to 25 years and interest only payments for up to 36 months, if your business has at least two years of revenue and good credit. It is not for investment property. A conventional commercial mortgage usually needs 25% to 35% down but suits any commercial property; the CSBFP can fill part of the gap for smaller businesses.
How much cash do you need to buy your business premises?
Enter the price and any renovation. The comparison shows the cash to close under three common ways of financing an owner occupied commercial property, before fees and closing costs.
Total project cost
$1,950,000
The 100% option depends on your business's profitability and credit and is subject to approval; the mortgage plus CSBFP option assumes a 65% first mortgage. Each needs at least two years of business revenue in most cases.
BDC, CSBFP and a commercial mortgage side by side
| BDC real estate loan | CSBFP term loan | Commercial mortgage | |
|---|---|---|---|
| Financing | Up to 100% of the project | Up to $1 million in term loans | About 65% to 75% of value |
| Amortization or term | Up to 25 years; up to 36 months interest only | Up to 15 years for real property | 20 to 25 years; terms of 1 to 10 years |
| Property | Premises your business uses | Premises your business uses | Owner occupied or investment |
| Business history | 24 months of revenue | Start ups eligible; revenue under $10 million | Depends on the lender and property |
| Cost | Priced by risk; not published | Capped at prime plus 3%, 2% registration fee | Bond yield or prime plus a spread, plus fees |
BDC details from BDC's commercial real estate loan page, November 2026. Asim Ali is not affiliated with BDC.
When does a BDC loan make sense?
- You are buying or building premises for your own business and want to keep cash in the business.
- You need to finance renovations, moving costs or a down payment along with the purchase.
- Your cash flow is seasonal or still growing, and interest only payments at the start would help.
When is a commercial mortgage the better fit?
- The property is an investment, tenanted by others, or residential rental of five or more units (see MLI Select).
- You can put 25% to 35% down and want the pricing of banks, credit unions or insurance company lenders.
- Your business has less than two years of revenue, or you need to close quickly; a B or private lender can bridge.
Many owners combine them: a commercial mortgage first, with a CSBFP loan or a development bank loan for the rest. Size the first mortgage with the commercial mortgage calculator and budget the closing costs on the Phase 1 and closing costs page.
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Call 604‑591‑3590 now, or send your details and Asim will reply within one business day.
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Frequently asked questions
What is a BDC loan?
BDC, the Business Development Bank of Canada, is a federal Crown corporation that lends to Canadian businesses. Its loans include commercial real estate, equipment, working capital and purchase financing, often with more flexible terms than a bank.
How much can BDC finance on a commercial property?
BDC says it can finance up to 100% of an eligible commercial real estate project, including the down payment and moving costs, depending on the project and your business's financial profile. Loans typically start at $100,000.
Who qualifies for a BDC commercial real estate loan?
A Canadian business that has generated revenue for at least 24 months, is profitable or has a clear path to profit, has good business and personal credit, and is buying, building or renovating premises for its own operations.
Can I use a BDC loan for an investment property?
Generally no. BDC's commercial real estate loan is for premises your business uses, and it excludes projects zoned for residential use. Investors buying rental or tenanted commercial property use a commercial mortgage instead.
Are BDC rates higher than bank rates?
Often somewhat higher, in exchange for higher financing and flexible repayment. BDC does not publish a rate range; it prices each loan by risk. Compare the total cost, not just the rate, against a commercial mortgage plus a CSBFP loan.
Want a lender's view of your numbers? Book an appointment with Asim Ali, ranked #4 in the CMP Top 75 Mortgage Brokers in Canada for 2026, or call 604‑591‑3590.