When commercial development meets business banking, it makes for an interesting Champions DFW Commercial Real Estate podcast. Jim Kelley and Lon Lloyd of Champions welcomed Elaine Leap of Chase Bank and local developer Brian Demma to share their insights on this podcast. Here is an excerpt…
Elaine Leap: “I think a lot of people think. Oh my gosh, if I engage a commercial lender then that I have to go with them. No, we don’t charge any fees at Chase if anything is referred, especially from Champions or any of our people out there. We don’t charge any loan origination fee. We don’t charge any application fee because we’re in it for the relationship. We’re in it for the long game I’ve had many of my clients for over 20 years and so we’re just going to try to get you teed up for success when you go to look for that property or that project.”
More from Elaine: “We are so excited that long-term fixed rates are here right now in the commercial world. It’s a little different, you know, for residential…if you’ve never done a commercial loan or building you think oh, well, I’m going to get a 25 or 30 year rate. No, that’s not how it works. It’s extremely volatile in the commercial rate world and the dollar amounts are larger. So typically what we do is a structure – if you go with a SBA Loans, small business administration loan, you’re going to get a fixed rate in the threes or low fours, which is historically low and Jim, you know, we’ve been doing this a long time for 25 years. So it doesn’t mean you have to keep it for 25 years. Some people are like, well, I’m not going to be in my building for 25 years. That’s okay. At least you can plan and know this is what your monthly obligation is going to be your investing back into your company. You’re investing in real estate, which is in this area. It’s almost always a good bet but the rates and the structures right now are so tremendous that you can usually purchase something for less than you can lease. Right?
Brian Demma on commercial development: “Well, I can’t imagine spending all those years building up your reputation and building up your business and having people come to a specific location time and time after again only to be pushed out due to higher–rising rents years down the line and almost feeling like you kind of have to start over you have to kind of drag your clients with you. We hear that a lot of a lot of times from clients who finally come to us saying I’m ready to build because my rent has become cost prohibitive and I think we can do this for the long term.”
Listen to the complete commercial development and business banking conversation in the podcast posted on our website or on iTunes.