Commercial real estate (CRE) is income-producing property used solely for business (rather than residential) purposes. Examples include retail malls, shopping centers, office buildings and complexes, and hotels. Financing—including the acquisition, development and construction of these properties—is typically accomplished through commercial real estate loans: mortgages secured by liens on the commercial property.

A commercial real estate loan is a mortgage secured by a lien on commercial property as opposed to residential property.

CRE loans are offered by banks, independent lenders, insurance companies, pension funds, private investors, and other capital sources, such as the U.S. Small Business Administration’s 504 Loan Program.

Lenders consider the nature of the collateral (the property being purchased), the creditworthiness of the borrower, and financial ratios when evaluating commercial real estate loans.