Secondary financing for retail properties

First National’s second mortgages are smart-risk solutions that enable borrowers to access capital and avoid penalties associated with breaking a first mortgage mid term.

Secondary financing is an attractive alternative to refinancing as it provides access to property equity that can be used to purchase another asset or renovate/repair an existing property. Loan terms typically range from six months to two years. Borrowers with a first mortgage may be eligible for secondary financing on the same property.

Strong operational history, property quality and location, as well as the borrower’s liquidity and net worth are key considerations for this type of financing.

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Smart risk solutions in action for retail

See how we’ve applied our financing products innovatively to help retail borrowers achieve their goals with performance and value.

CMHC MLI Select refinance that achieved level 3 energy efficiency to payout existing conventional construction mortgage and equity takeout

$128.9 M
400 units
Montréal, QC

CMHC insured mortgage
10 years term, 50 years amortization
LTV: 72%

Refinance to provide equity take-out for future acquisitions on a mortgage-free retirement residence

$40.3 M
165 units
Kelowna, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

CMHC Market refinance of a free and clear retirement residence to provide equity take-out for working capital

$47.4 M
169 units
Kelowna, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

Refinance of a free and clear retirement residence to provide equity take-out for improvements and acquisitions

$44.1 M
158 units
Penticton, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

Refinance of a construction mortgage for a 31-storey, 266-unit building with 4,751 sq. ft. of retail space

$113.4 M
266 units
London, ON

CMHC insured mortgage
5 years term, 50 years amortization
LTV: 92.91%

Construction mortgage to develop a 7-storey and 10-storey complex with 159 units

$57 M
159 units
Oakville, ON

CMHC insured mortgage
5 year term, 40 years amortization
LTV: 80%

CMHC Market refinance of an 8-storey, 157-unit building to repay the current debt and equity take-out

$31.8 M
157 units
Sainte-Jérôme, QC

CMHC insured mortgage
5 year term, 40 years amortization
LTV: 70%

Refinance through CMHC MLI Select that realized Level 1 energy efficiency and accessibility to pay out existing debt and equity takeout.

$51.5 M
197 units
London, Ontario

CMHC insured mortgage
5 years term, 40 years amortization
LTV: 85%

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Latest resources and insights

Original perspectives and personal viewpoints on developments and industry trends in commercial real estate.

Growth, Value and Risk

Bank of Canada brings its benchmark interest rate down 50 basis points to 3.25%

The Bank of Canada tied a bow on 2024 by cutting its policy interest rate once again today to 3.25%. This latest 50 basis point drop – coming on the heels of reductions in June, July, September and October – is welcome news.

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Expert insights

A distinctly Western Canadian view of the year in commercial real estate financing

Activity in 2024 was bifurcated. In the first half of the year, overall real estate investment activity was relatively muted as interest rates remained in restrictive territory.

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Borrower perspectives

Borrower Perspectives: Rob Piroli, President, Piroli Group

Founded in 1992 in Leamington, Ontario, Piroli Group started in general contracting (under the name of Piroli Construction) but has evolved into a multi-faceted development group.

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Capital Markets update

Market Commentary: A catch-up and overview of the markets

First National’s, Jason Ellis, provides an overview as well as an update of the markets including rates, Government announcements and changes to the Commercial mortgages. Read an overview here.

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View other retail mortgage solutions

Standard financing

First National’s standard financing programs are favoured by borrowers when acquiring a new property or refinancing an existing building. Loan terms typically range from three to five years, have a fixed interest rate, and are closed to prepayment for the term’s duration.

Bridge financing

First National’s bridge loan terms usually range from three months to three years, include floating interest rates and allow some form of early prepayment. Borrowers choose this solution until standard financing is secured or while they contemplate a property sale, a change in ownership structure or enhance their tenant roster.

Asset repositioning

First National enables owners to access a property’s equity for a short term, typically two years or less, to fund capital improvements or repairs without the need to raise capital from personal sources or less flexible, higher-cost alternatives.

Construction financing

A First National construction loan provides funds to cover the cost of building or rehabilitating a retail property with terms typically of three years or less.