How CEOs Use Seller Financing to Own Commercial Property

Seller financing isn’t just for small residential deals or first-time buyers. It’s a powerful tool CEOs can use strategically to acquire commercial property, control their company’s operational base, and build long-term equity.

Instead of leasing a building owned by someone else, imagine owning it yourself—and having your business pay rent to you. Seller financing makes that move more accessible, especially when traditional lenders pose roadblocks.

What Is Seller Financing in Commercial Real Estate?

Seller financing is a deal structure where the property owner acts as the lender. Instead of a bank issuing the loan, the seller accepts a down payment and finances the remainder of the purchase price. The buyer signs a promissory note and makes regular payments (principal + interest) over time.

This type of deal can be structured with flexible terms, negotiated directly between buyer and seller. CEOs can use this arrangement to purchase office buildings, warehouses, or mixed-use properties—even when traditional financing isn’t ideal or available.

Why CEOs Should Consider This Strategy

There are three key advantages for CEOs leveraging seller financing:

Control and Stability
When your business rents from you, lease negotiations, rent hikes, and relocation risks disappear. You decide the terms.
Asset Ownership and Wealth Building
The commercial property becomes a long-term asset on your personal or holding company’s balance sheet, not a sunk cost.
Tax Efficiency
Your company deducts rent payments as a business expense. Meanwhile, you (or your holding entity) reports rental income and claims property depreciation.

A Realistic Scenario

Let’s say you run a marketing agency in an urban center. Your current lease is $12,000/month. You find a 4,000 sq ft building listed at $1.1 million. The seller is open to financing 75% at 6.5% interest over 15 years with a $275,000 down payment.

Instead of paying a landlord $144,000 per year, your company pays you. You gain:

Equity as the note amortizes
Appreciation upside on the property
Cash flow advantages from rent exceeding debt service

After 10 years, your note balance drops significantly while the building value likely increases. Meanwhile, your business benefits from lease stability.

Holding the Commercial Mortgage Note

If the deal is seller-financed, the seller holds the commercial mortgage note initially. But if you negotiate a wraparound mortgage or a private financing vehicle, you can structure the note under your own entity and make payments to the seller. Over time, as you build equity, you can refinance or pay off the note in full.

The key: your holding entity owns the property and the mortgage note becomes part of your personal investment portfolio. This dual structure offers control over occupancy and upside from equity growth.

Structuring the Deal Properly

It’s critical to work with an attorney and CPA to establish the right structure. Some CEOs:

Use an LLC or holding company to purchase and own the property
Draft a lease agreement between their business and the holding entity
Ensure arms-length, commercially reasonable rent terms

Your legal team should also draft the promissory note, lien documents, and clarify property tax and maintenance obligations.

Properly structured, this setup avoids conflicts and ensures tax compliance.

Risks to Consider

Like any investment, there are downsides:

You tie up capital in a down payment
The company must remain healthy enough to meet lease payments
If property values drop, refinancing could become difficult

Mitigation:

Run conservative cash flow projections
Keep adequate reserves
Negotiate seller-friendly terms (balloon payments, early payoff options)

Why Seller Financing Is Often Overlooked

Seller financing isn’t top of mind for many corporate leaders. Traditional bank financing has long been the go-to. But in times of rising interest rates or tighter lending criteria, seller financing fills a crucial gap.

Sellers looking to exit commercial properties may prefer steady income over a lump sum. CEOs ready to secure long-term business infrastructure should see that as an opportunity.

Marketing Advantage: Owning Your Location

There’s brand value in owning the building your business operates from. It signals permanence, confidence, and success.

From a marketing standpoint:

You control signage and branding opportunities
You can host clients in a custom-designed, branded environment
It reinforces long-term vision to employees and stakeholders

In addition, owning your facility can make your business more attractive to future investors, acquirers, or partners.

Conclusion

Seller financing gives CEOs a nontraditional but powerful path to real estate ownership. It creates a long-term asset while giving your company stability. You become both landlord and business operator—and potentially gain equity, tax advantages, and flexibility.

When structured correctly, owning the building through seller financing and renting to your business is a smart strategy. It’s not for every CEO. But for those with vision, it turns an operational cost into an investment.

Start with a conversation. Look for off-market opportunities. Sellers who want out, and leaders who want in.

Owning your space might be the best business move you make this decade.