Chicago commercial real estate loan rates affect every part of a CRE deal, from cash flow to final returns. Even a minor rate difference can add up to substantial costs over the life of a loan.
This is why it’s important to understand not just borrowing costs, but also the local factors that influence how lenders price risk and set interest rates.
This guide breaks down current CRE loan interest rates in Chicago and explains key differences between loan types. We also point you to the best commercial loan lenders in Chicago to help you secure better terms.
Current commercial real estate loan rates in Chicago
Before you proceed: Keep in mind that unlike residential mortgages, CRE loans are highly customized based on the borrower’s credit profile, property type, LTV ratio, DSCR, location-specific risks, etc.
Two borrowers with similar properties could receive significantly different rate offers because of this. Also, many private and non-bank institutions do not publish fixed rates and may adjust pricing internally based on their own risk models and funding conditions.
Also read about: How does Commercial Real Estate Loan Rates Work?
What are the current interest rates for commercial real estate loans in Chicago?
Here are the typical Chicago commercial real estate loan rates as of May 13, 2025. These figures represent general benchmarks ONLY — individual rates may vary depending on the borrower’s profile, the asset class involved, and lender-specific requirements.
Disclaimer: All rate ranges mentioned in this post reflect general market conditions as of the stated date. They should be used for reference only and not as a guarantee of current or future loan pricing. Speak directly with a lender or commercial mortgage advisor for personalized loan options.
Factors influencing CRE interest rates in Chicago
Federal Reserve policy & prime rate changes
When the Fed cuts the federal funds rate, borrowing typically becomes cheaper — and when it raises rates to fight inflation, loan costs increase. Tools like quantitative easing and tightening also impact long-term rates by adjusting market liquidity.
Local economic conditions
Lenders watch Chicago’s job market, GDP growth, and business activity closely.
If unemployment is low and the economy’s expanding, they’ll generally see CRE investments as lower risk — and that usually means better rates. If the local economy shows signs of slowing, lenders may hedge their risk with higher pricing.
Loan-to-value (LTV) and debt-service coverage ratio (DSCR)
The more equity you put into the deal, the less risk the lender takes on. A lower LTV—say, 65% instead of 80% — can help you qualify for a better rate.
Lenders also look at DSCR to gauge whether your property generates enough income to cover the loan. If your DSCR is 1.25 or higher, that signals a financial cushion — and lenders will usually respond with more favorable terms.
Also read about: How to Calculate LTV for Hard Money Loans
Property type
Multifamily properties tend to get the best rates thanks to steady rental demand. Industrial assets also perform well, especially when backed by reliable tenants.
Office properties are more sensitive to market shifts, particularly in areas with high vacancy.
Retail can be hit or miss—grocery-anchored centers often look solid, while struggling malls tend to raise concerns.
Borrower profile
Your credit score, investment history, and the quality of your collateral all influence what lenders offer.
If you have strong financials, a solid track record, and a well-located property with dependable tenants, you’re likely to receive more competitive terms.
Neighborhood & zip code trends
Properties in established areas with stable demand typically come with better rates.
If you’re targeting an emerging submarket, be prepared to justify the growth story—lenders may quote higher rates unless there’s clear momentum and tenant interest.
Loan options available to investors in Chicago
Tips to secure the best rates in Chicago’s CRE market
Interest rates aren’t fixed — you can actually influence what lenders offer. Here’s how to improve your odds of locking in a better deal:
1. Strengthen your credit and financials
Lenders reward low risk. Pay down existing debt, correct any credit report errors, and keep financial statements organized. A higher credit score and stable financial history can push rates down.
2. Compare lenders, not just offers
Rates and terms vary widely between banks, credit unions, and private lenders, so shop around. Even a small rate difference can mean thousands in long-term savings. And don’t just ask about interest rates — look at fees, prepayment penalties, and flexibility as well.
3. Put more equity into the deal
A lower loan-to-value (LTV) ratio gives lenders confidence. If you can increase your down payment or equity contribution, you reduce their risk — and they may respond with a better rate.
4. Choose income-strong properties
Target properties that already generate solid net operating income. A DSCR of 1.25 or higher tells lenders the asset can support the loan. The stronger the cash flow, the better your financing terms.
5. Get pre-approved or work with a broker
Pre-approval helps you move quickly when opportunities arise. A commercial mortgage broker with Chicago market experience can also help you access lenders you might not find on your own and negotiate better terms on your behalf.
Best commercial loan lenders in Chicago
If you’re looking for flexible commercial real estate financing or simply want to find out the current CRE loan interest rates, get a custom quote from Private Capital Investors — one of the private commercial real estate lenders. Apply online or call 972-865-6206 to speak with a loan specialist.
