How to Secure Office Financing in 2025

Office real estate has been facing one of its toughest chapters for a few years now. Remote and hybrid work have reshaped tenant demand, forcing owners and brokers to adjust to a new normal. Financing is still available — but only for the right asset, in the right market, with the right story.

This guide is one component of our longer collection on financing any commercial property type.

Office Defined: Collaboration, Commerce, and Change

At its core, office real estate houses professional services: law firms, tech companies, doctors, coworking operators, and more. The revenue model is relatively straightforward: long-term leases, often with built-in rent escalations. But owners face significant upfront costs to land and keep tenants, including tenant improvement allowances (TIs) and leasing commissions (LCs).

The capital intensity, long leasing cycles, and evolving demand profiles make lender selectivity especially sharp in this sector.

Office Subtypes and Their Financing Profiles

Professional Office Buildings

These are traditional multi-tenant buildings found in urban and suburban markets.

• Class A: Premium properties with strong amenities and locations.
• Class B/C: Older buildings or those in weaker locations. These are struggling the most in today’s market.

Medical Office Buildings (MOBs)

Extremely resilient and lender favored due to:

• Sticky tenants (e.g., outpatient surgery centers, dialysis clinics).
• Long-term leases.
• High TI costs, but low turnover.

MOBs are financeable by, among others, life companies and banks.

Coworking Spaces

Properties leased to coworking providers or operated as shared workspaces face scrutiny due to business model risk.

• Lenders prefer owner-operated models with strong occupancy history.
• National operators with master leases can work, but their credit is key.

Office Land

Raw land for office development is a real challenge to finance today.

• Expect high equity requirements and short-term debt (if available at all).
• Rezoning, entitlements, and clear pre-leasing strategies are essential.

Financing Office: A Split Market

Office is no longer a monolith. There’s a widening gulf between what lenders will and won’t touch.

The Financeable

• Class A or trophy assets in prime locations.
• Long-term leases with credit tenants.
• Medical office with stabilized cash flow.
• Owner-occupied assets in a sale-leaseback structure.

The Unfinanceable (for now, anyway)

• Class B/C buildings with high vacancy.
• Assets in tertiary markets with poor tenant demand.
• Buildings with significant deferred maintenance or CapEx needs.

Lender Hot Buttons

Lease Term and Rollover

Lenders want long Weighted Average Lease Terms (WALTs). Short-term leases or significant near-term rollover is a red flag.

Future Capital Requirements

Modern office leasing is expensive. Lenders now require borrowers to reserve more upfront to cover future TIs and commissions.

Exit Strategy

What's the long-term plan? Lenders want to understand how sponsors will maintain value in a changing market.

Opportunities in Office

Medical Office

The clear winner in the sector. Expect relatively strong lender appetite and competitive terms.

Adaptive Reuse

Converting an underperforming office building to multifamily or life sciences? If the sponsor has a track record and the location supports it, bridge debt may be available.

Sale-Leasebacks

If an owner-user sells their building and leases it back on a long-term, triple-net lease, it can create a financeable, cash-flowing asset that attracts institutional capital.

Making the Case in a Difficult Market

Financing office in this environment is about more than comps or debt yields. It’s about telling a story lenders believe. If you’re brokering office deals:

• Know the difference between an asset and a liability.
• Emphasize tenant quality, lease term, and sponsor experience.
• Bring a plan for the future—not just a spreadsheet from the past.

In office, more than any other asset class, the capital follows conviction.