CMBS Loans in South Carolina

How do cmbs loans work in South Carolina?

Commercial Mortgage-Backed Securities (CMBS) loans are commercial mortgages that are pooled together and sold as bonds to investors. They offer competitive rates and non-recourse terms for larger stabilized properties, typically $2M and above. In South Carolina, 13 lenders currently offer CMBS financing with loan amounts from $2M to $500M and rates typically ranging from 5.5% - 8%.

What does the South Carolina market look like?

South Carolina has attracted major manufacturing investments from BMW, Boeing, Volvo, and others, establishing a strong advanced manufacturing corridor. Charleston's port growth and tourism economy drive significant CRE demand along the coast.

South Carolina assesses commercial property at only 6% of fair market value, one of the lowest assessment ratios in the nation, resulting in favorable effective tax rates for CRE investors. The state's fee-in-lieu-of-taxes (FILOT) program allows negotiated property tax rates for qualifying manufacturing and commercial projects, often reducing effective rates by 50% or more. Charleston's rapid growth has created a competitive CRE market, but the city's aggressive flood mitigation requirements and the Dutch Dialogues-inspired stormwater management standards add costs that investors should factor into coastal commercial development budgets.

Who should consider cmbs loans?

• Large stabilized properties
• Borrowers wanting non-recourse
• Properties in major markets
• Long-term investors

What are the key requirements?

• Stabilized property
• DSCR ≥ 1.25
• LTV ≤ 75%
• Property in acceptable market
• No major deferred maintenance

What are the pros and cons?