Real Estate Articles

Commercial mortgage loans are executed using real estate to collateralize the loan. Commercial mortgages are similar to residential mortgages, except that the collateral used to secure the loan is a commercial (business) building rather than a personal residential home. If the borrower defaults on the loan, the lender can seize the collateral (building) to recover the loan proceeds.

Commercial mortgage loans are not available to persons, but rather to businesses, which include partnerships, incorporated businesses, limited companies, etc. The business must be sound financially and the process to verify the business income can be more complicated than verifying the credit worthiness of a specific individual. That is why traditional commercial mortgages can take six to nine months to underwrite.

Commercial loans are procured for a variety of reasons: to buy the premises of an existing business, to make improvements or enlarge existing premises, to make commercial and residential investments or to develop the existing property in other ways. An example would be to buy already constructed business premises, like offices, shops, restaurants, or pubs. Additionally, they can also be used to buy business assets such as plant equipment and specialized machinery.

The Interest rates for commercial mortgages are generally higher than those for residential mortgages but lower than interest rates on unsecured business loans. A fixed-rate loan is the most common commercial mortgage. It is similar to the fixed rate home mortgage loan in that the interest rate remains constant throughout the term. However, the term for most commercial mortgage loans is between 3 and 10 years but they can be extended for as long as 25 years.

The commercial mortgage loan amount and interest rate that you can receive is a direct correlation of the credit worthiness assessed by the lender with respect to your ability to repay the loan. If you have an excellent business record with a verifiable profit and loss business statement then you will have little trouble getting a commercial mortgage at an attractive interest rate.

Commercial loans are not provided without extensive scrutiny regarding your business stability and profitability. The Lender usually wants to see your last three years of audited financial statements including a Profit and Loss statement, balance sheet and a cash flow forecast. Favorable business information is critical to the lender and to you because, as stated earlier, if you default on the loan the lender can repossess your property and sell it to repay the outstanding mortgage balance.

The best place to find commercial mortgage loans is on the Internet. There are enormous numbers of commercial lenders vying for your business and they all advertise on the Internet. It is possible to compare many loan quotes side by side and determine which is best for your financial situation.

Mortgage loans can be a confusing and complicated subject for many people. For some straight talk visit Home Mortgage Loans and learn more about the different Types of Mortgage Loans.

Even back in the early days of industrial America, a need for fire safety measures was already being acknowledged. In the textile mills, with their highly-combustible materials, sprinkler systems of perforated pipe were installed. These first systems were not automatic and had to be worked by hand. So, in 1872, Philip W. Pratt patented the first automatic sprinkler system. It was an improvement on the hand-operated system, but not much. This system was followed in 1874 by an improved one which offered the first practical sprinkler head. The inventor, Henry S. Parmalee, installed the prototype in his own piano factory.

The only people who were interested in installing these primitive sprinkler systems were men employed in commercial enterprises, but they didn’t do it to save lives. By having sprinklers installed, their insurance companies gave them reduced rates. Since the discount was enough to more than offset the cost of the sprinkler system, they quickly had them put in. What a way to make a profit! Things stayed this way until the 1940s when stricter building codes required that schools, hospitals, hotels, and other public buildings have sprinklers installed, too.

As people in the U.S. became more safety conscious, it became mandatory to install fire alarms in facilities where one hundred or more people could assemble. This meant that every school, church, shopping mall, hospital, theater, hotel, and other large facilities were required to install fire alarm systems. In addition, any public facility that is located farther than 75 feet from a fire station or fire hydrant is required to install one, as well as buildings where hazardous materials are stored.

Insurance companies are refusing to insure businesses which don’t comply with the laws requiring fire alarm systems. Because of this, they are no longer taking on the responsibility of insuring businesses which they feel are at high risk of sustaining high-ticket claims for building loss, property damage, and human casualties. In addition, in order to have insurance, any business where people can stay the night must also have a fire alarm installed.

The high-tech ESFR sprinkler system uses cutting edge methods designed to contain fires and keep them from spreading. These sprinklers are pre-programmed to activate when their sensors feel a certain temperature. At that time, they will go on only in the areas of the building where they are needed. The other sprinklers remain off so that all of the available water pressure is funneled to the areas where the fire is.

Sometimes companies will have areas where they keep sensitive materials which absolutely cannot be exposed to water unless there’s an emergency. There are alarms which are designed especially for areas like these that are called “dry systems”. If an alarm is triggered in this water-sensitive area, sensors will respond by using smoke and heat detectors and will determine if there really is a need for water. This type of system drastically reduces the chance that sensitive items will accidentally be exposed to water.

Modern technology keeps supplying us with more and more effective methods of fighting fires and saving lives. We can live without the fear of those old fires in the workplace that killed hundreds. No one thinks of workplace deaths any longer since they’ve become so rare. Don’t you think Henry S. Parmalee would love to see what’s happened to his little invention?

Visit us for more information on how do fire alarms work, advice on fire alarms and fire alarms for deaf people

While the world screams “recession”, inflation spirals out of control and property markets fall into a slump the world over, some of the most ambitious construction projects are underway in some of the biggest cities in the world. Some label these projects foolhardy, and believe that they are destined to fail, or at the very least be completed years beyond the projected deadlines at billions of dollars over budget. Others believe that there projects foretell of rising confidence in the property market over all, and are indicative of a firm belief in consumer confidence.

In an article for The Wall Street Journal Online, Alex Frangos, looks at some of these large-scale projects and the implications for the world at large, as well as the companies directly involved in the endeavors. The five biggest construction projects are planned for New York City, London, Milan, South Korea and Los Angeles and cost a total of $64.8 billion (£32.63 billion or R490.8 billion).

The cheapest of the projects is Garden Avenue in LA, at $3 billion. It is intended to revitalise the flagging downtown area and includes a 16-acre park, residences and a hotel. Phase one of the project is expected to be completed in 2011. Next is Porta Nuova in Milan at $3.6 billion. The “New Gate” will be built in the vicinity of the Garibaldi Train Station. The project was designed by 25 architects and will include a cultural centre, park, offices, homes and stores. Completion is planned for 2012.

Stratford City in London will cost an estimated $7.9 billion. It was initially planned for the 2012 Olympics, but completion of all the phases is only expected in 2020. It will consist of 180 acres, of which 5 million square feet will be devoted to offices; there will also be space for 5,000 residences. Hudson Yards in New York City is designed to optimize the limited space within the city by building a platform over the trains on the Hudson River. The platform will occupy 45 million square feet and will be devoted to office space, residential towers and a ‘green space’, presumably so that people don’t go insane surrounded by all that concrete. The project is estimated to cost $20 billion and is expected to be finished in 2020.

The most ambitious project, Songdo City in South Korea, has been under construction since 2005 and is expected to be completed in 2014. 1,500 acres of land near the Incheon International Airport will be built into the first city in the world dedicated to being an International Business District. It is expected to house 300,000 workers, 65,000 residents and is budgeted at $30 billion.

One of the reasons for the skepticism surrounding these projects is that banks are cutting back on commercial real-estate loans, which means that capital-rich large-scale projects will struggle to find the cash to keep construction going. But most companies that tender for mega-projects such as these are well-aware of the inherent risks, and are willing to go forward anyway, because if they are successful, their reputations within the construction industry will be made.

In a time when many construction projects are being abandoned due to floundering economies and various belt-tightening initiatives, it’s comforting to know that there are still people out there who are willing to stake billions of dollars on the hopes of an economic upturn. Perhaps the property market isn’t in such dire straits after all.

Recommended site:

http://www.realestatejournal.com/buysell/markettrends/20071227-frangos.html

Sandra wrote this article for the online marketers Trafalgar property managers leading specialists in property management, residential letting and property insurance.