Commercial Property · Singapore
Most Singapore property owners know you can unlock cash from a private condo or landed home. Far fewer realise that commercial property — shophouses, office units, industrial spaces, and retail units — can be even more powerful for equity cashout. Different rules apply, and they are often more favourable than residential.
Commercial property lending in Singapore operates outside the MAS residential mortgage framework — which means several of the restrictions that limit residential equity cashout simply do not apply.
Commercial property lending has no fixed MAS-prescribed LTV ceiling. Unlike residential properties where MAS enforces strict LTV caps, commercial property loans face no fixed MAS-prescribed LTV ceiling — limits are set by individual banks based on internal risk policies, borrower profile, and property specifics. This gives banks — and brokers — significantly more flexibility to structure the right deal for your situation.
Conservation and mixed-use shophouses across all Singapore districts and conservation areas. A retail shophouse valued at $4M with stable tenants could secure an 80% LTV, equating to a $3.2M loan.
Strata office units in the CBD, city fringe, and business parks. Assessed on rental yield and tenant covenant quality.
Factories, warehouses, and business park units. Owner-occupied industrial units may receive more favourable terms due to lower perceived risk.
Retail strata units in malls, shopfront F&B spaces, and mixed-use commercial developments. Assessed on tenancy strength.
HDB commercial units (coffee shops, HDB shophouses under HDB ownership) generally cannot be used for commercial equity cashout through standard banks. Properties with very short remaining lease tenures — typically under 30 years — may attract very low LTV or may not qualify at all. Check your property's remaining lease before applying.
Because there is no fixed MAS ceiling, LTV for commercial property cashout is negotiated based on:
| Factor | Impact on LTV offered |
|---|---|
| Property type | Shophouses and strata offices typically attract the highest LTV (75%–80%). Industrial and retail slightly lower (65%–75%) |
| Tenancy status | Tenanted property with strong covenant tenants (MNCs, government bodies) gets better LTV than vacant units |
| Rental yield | Higher rental income relative to loan repayment (DSCR) supports higher LTV — typically banks require DSCR ≥ 1.2x–1.4x |
| Lease remaining | Freehold or 999-year properties command the best LTV. Short leasehold (under 60 years remaining) reduces LTV significantly |
| Borrower profile | Strong company financials, low existing debt, clean credit history all support higher approved LTV |
| Bank appetite | Different banks specialise in different commercial segments — some prefer shophouses, others industrial. Matching the right bank matters. |
The TDSR framework — which caps all monthly debt repayments at 55% of gross personal income — does not apply to commercial property loans. This is one of the most significant advantages for borrowers who are retired, self-employed, or have income structures that make TDSR difficult to pass on residential loans.
Instead, commercial property cashout is assessed using the Debt Service Coverage Ratio (DSCR) — which measures the property's rental income against the loan repayment obligation:
DSCR = Annual net rental income ÷ Annual loan repayment
Banks typically require a minimum DSCR of 1.2x to 1.4x — meaning the property's rental income must cover at least 120%–140% of the annual loan repayment. A DSCR of 1.5x or above is considered strong and typically supports the highest available LTV.
For owner-occupied commercial property with no rental income, banks assess the business's operating income against the loan repayment instead — similar to a business term loan assessment.
A 75-year-old owner of a fully tenanted Tanjong Pagar shophouse earning $18,000/month in rental income can access equity cashout with no personal income check — the rental yield covers the DSCR requirement, and the residential TDSR framework simply does not apply. This is a fundamentally different — and often more accessible — pathway than residential equity cashout for asset-rich borrowers.
Regardless of your nationality or how many other properties you own, there is zero Additional Buyer's Stamp Duty on commercial and industrial property in Singapore.
For property investors who already own residential properties — and would face 20%+ ABSD on any additional residential purchase — commercial property is a completely separate asset class that carries no ABSD, no count toward the residential LTV tier, and no impact on future residential property purchases.
This makes commercial property equity cashout particularly valuable for investors managing a mixed portfolio — unlocking commercial equity does not trigger any of the residential property cooling measures.
Unlike residential equity loans which disburse a fixed lump sum, commercial property owners can access a property equity overdraft facility — a revolving credit line secured against the commercial property.
For commercial property owners, some banks offer property equity overdraft facilities. This works like a standby credit line: you draw down cash as needed up to your approved limit, and only pay interest on the amount drawn. You also have the flexibility to repay principal at any time without penalty.
This structure is particularly suited to business owners who need flexible access to capital — drawing down for payroll or inventory when needed, repaying when receivables come in, and only paying interest on the outstanding balance at any given time.
| Feature | Lump sum equity loan | Overdraft facility |
|---|---|---|
| Disbursement | Full amount at once | Draw as needed up to limit |
| Interest charged | On full loan amount from day 1 | Only on amount drawn |
| Repayment | Fixed monthly schedule | Flexible — repay anytime |
| Best for | Large one-off capital need | Ongoing working capital, variable cash flow |
| Availability | Residential + commercial | Commercial property only |
Commercial property loan rates are typically slightly higher than residential mortgage rates due to the higher risk profile of commercial assets. Current indicative rates:
| Product | 2026 indicative rate | Structure |
|---|---|---|
| Shophouse / strata office loan | 2.5%–3.5% p.a. | SORA-based floating or fixed-rate packages |
| Industrial property loan | 2.8%–4.0% p.a. | SORA-based floating |
| Commercial overdraft facility | 3.0%–4.5% p.a. | Floating — charged on drawn balance only |
| Bridging / short-term facilities | 5%–8% p.a. | Fixed term, 6–24 months |
Even at 3%–4% p.a., commercial property equity cashout is significantly cheaper than unsecured business loans (7%–10% EIR) or personal loans — and dramatically cheaper than overdraft facilities or credit cards.
No CPF statement required — commercial properties are not purchased with CPF, so there is no CPF deduction from the cashout calculation.
Mr Ng needs $1.5M to fund his children's business expansion. At 75% LTV, $3M is available. No TDSR — DSCR assessed: $22K/month rental ÷ $7,200/month repayment on $1.5M at 3.0% p.a. over 25 years = DSCR 3.06x. Well above the 1.2x minimum. No income check on personal salary at age 68. Approved in 3 weeks.
Ms Tan needs $800K to upgrade her production line and expand capacity. Industrial unit is owner-occupied — no rental income, so assessment uses business operating income. Company revenue $4.2M p.a., operating profit $680K p.a. Loan repayment at 3.5% p.a. over 10 years: $96K p.a. DSCR: 7.1x. Approved. Rate: 3.2% p.a. VeFi compared DBS, OCBC, and UOB — OCBC offered best terms for industrial segment.
Mr Lee's trading business has variable cash flow — he needs capital available but doesn't want to pay interest on a lump sum sitting unused. VeFi structures a $1M overdraft facility secured against the Shenton Way unit at 3.8% p.a. He draws $350K when needed, pays interest only on $350K ($1,108/month), repays when receivables come in. Flexible, cheap, and on-demand.
Commercial property lending is significantly more nuanced than residential. Banks have very different appetites by property type — DBS, OCBC, UOB, and Maybank dominate Singapore SME commercial lending, each with distinct appetite — some prefer shophouses, others B1/B2 industrial, others F&B-tenanted retail. Submitting to the wrong bank wastes time and triggers unnecessary credit bureau enquiries.
A broker who understands commercial property lending can pre-position your file with the bank most likely to approve at the highest LTV, structure the application to present rental income or business revenue in the most favourable light, and compare terms across multiple lenders in a single conversation.
VeFi handles commercial property equity cashout across shophouses, strata offices, industrial units, and retail spaces — working with DBS, OCBC, UOB, Standard Chartered, Maybank, and CIMB. We serve commercial property owners across Singapore from Tanjong Pagar and Chinatown to Jurong, Tampines, Woodlands, and Sengkang.
For context on how residential equity cashout compares, see our Complete 2026 Guide to Property Equity Cashout. For business owners using property to fund operations, see Can I Use My Property Equity to Fund My Business? For refinancing vs cashout, see Refinancing vs Property Equity Cashout — Which Should You Choose?
Find out how much equity you can unlock — free assessment, 48-hour response. No income check on the personal salary. Assessed on your property's rental yield.