Here’re some creative strategies for financing your first commercial real estate investment
If you’ve ever thought about investing in commercial real estate (CRE), you’ve probably hit the same wall most beginners do: financing. Banks and traditional lenders have long lists of requirements—solid credit, big cash reserves, proven property management experience, just to name a few. If you’re just starting out, it can feel like an impossible mountain to climb. There are creative ways to get the capital you need without being a bank-approved superstar. You just have to think differently—and maybe get a little resourceful.
Let’s break down some proven strategies to secure funding and start building your commercial property portfolio—even if you’re a newbie.
Seller Financing: Make the Seller Your Bank
Seller financing is like a secret cheat code in real estate. Instead of borrowing from a bank, the seller becomes the lender. You pay them directly, and terms can be much more flexible than traditional loans.
Seller financing gives you the opportunity to negotiate down payments, interest rates, and loan length, you most likely will not need to have perfect credit or decades of experience making it easier to qualify especially if you can show the property has value and potential.
If you are feeling like going for it you can ask for 100% financing or want longer term so you’re not rushing to refinance? You can ask for it. The key is building a relationship and showing the seller why this works for both of you—they get passive income, you get a property.
Joint Ventures: Leverage Other People’s Power
A joint venture allows you to combine resources with other investors. Think of it as bringing your superpowers together to tackle bigger deals than you could alone. When you JV you share equity stakes and mortgage responsibilities, you can also leverage your partners’ experience and connections which can allow you to take on larger projects without shouldering all the risk on your own.
Joint ventures are perfect if you can build trust with experienced investors. They bring money and know-how; you bring vision and hard work.
Crowdfunding: Tap Into the Crowd
Crowdfunding platforms like CrowdStreet have revolutionized how people invest in CRE. Instead of borrowing from one bank, you can raise funds from dozens—or even hundreds—of smaller investors.
The benefits of crowdfunding are lower personal capital requirements—investors can contribute as little as $10,000, it helps boost your visibility, some platforms help market your project to potential investors which if you are newer can be huge. There is a downside to this though, you will immediately be managing multiple investors so you will need to understand how to run your growing organization and here’s something you really need to be ready for, SEC regulations and oversight. But if you do it right, crowdfunding lets you scale faster than ever before.
Lease-to-Own: Control Now, Buy Later
Lease-to-own is essentially a way to test-drive a property while renting it. During your lease period, which typically ranges 3–5 years, it gives you time to get everything in order. You can save up for a nice downpayment, work on the properties financials so when you own it you are in a good place and maybe the best is be patient and secure permanent financing under the best terms for your needs.
Here’s what you need to consider
What’s my current financial situation and experience level?
Do I have reliable partners or mentors?
What motivates the seller?
How much flexibility do I need?
There’s no one-size-fits-all solution. The key is to stay persistent, creative, and proactive. Learning from videos or blogs is helpful, but real growth happens in the field.
Financing your first commercial property might feel impossible—but it’s not. With seller financing, joint ventures, crowdfunding, and lease-to-own strategies, you can unlock doors that traditional banks keep closed. Start small, build your track record, get creative, and eventually, larger deals will follow.
Your next step? Go out, find a deal, and put these strategies to work. The first property is the hardest—but once you’ve done it, the path to building a thriving commercial real estate portfolio becomes a whole lot clearer.
