If you’ve ever spent months searching for the right commercial space to lease — and come up empty — you’re not alone. Finding the right size, the right zoning, the right location, at the right price, at the right time is harder than most business owners expect. But what if the search itself was pointing you toward a better answer? That’s exactly what happened to one of my clients here in the Greater Montreal area. They run a health and wellness business and were paying $11,500 a month in rent on a long-term lease. When that lease ended, they needed 5,000 sq ft of mixed commercial/industrial space — and couldn’t find anything that worked. So we asked a different question: what would it cost to own instead? BDC financing covered 100% of a $1.6M purchase, and the monthly payment came in at roughly the same number they’d been handing to a landlord for years. Same dollars. Completely different outcome. This post breaks down how that decision got made, what the financing actually looked like, and how to know if buying commercial space might be the right move for your business.
When the Lease Search Hits a Dead End There’s a specific kind of frustration that comes from searching for commercial space with a deadline hanging over you. Your existing lease is ending. You need to be somewhere new. And nothing available checks all the boxes. That was the situation my client found themselves in. Their health and wellness business had specific spatial needs — 5,000 sq ft of mixed commercial/industrial space that could accommodate both client-facing areas and operational requirements. In a tight Montreal-area market, that combination is harder to find than most people expect. Options were limited, and what did come available either wasn’t the right size, wasn’t zoned correctly, or came with lease terms that made the numbers worse than staying put. This is more common than people realize. Commercial vacancy rates in many markets have tightened significantly, and the spaces that do come available often require expensive build-outs that add to the real cost of leasing. For business owners with specific spatial or operational needs, the lease market can feel like a game of musical chairs with not enough seats. The pivot moment for my client came when we stopped asking "what can we lease?" and started asking "what can we own?"
Running the Numbers: The $2,000 Question Here is the honest comparison — no spin. My client was paying $11,500 a month in rent. When we ran the numbers on a $1.6M purchase at 4.6% interest over 25 years, with BDC financing 100% of the purchase price, the monthly mortgage payment came out to $8,985. Add in annual property expenses of $55,000 — roughly $4,583 a month — and the total monthly cost of ownership lands at $13,568. That is $2,068 more per month than renting. So ownership is more expensive. Is it still worth it? Here is the case for yes. In year one alone, $34,943 of those mortgage payments go directly toward principal — equity they own, not money that disappears. After 25 years, the building is theirs, free and clear. Meanwhile, $11,500 a month in rent over 25 years — assuming it never goes up, which it will — adds up to $3.45 million paid out with nothing to show for it at the end. The real question is not "is ownership cheaper?" It is "what is owning a $1.6M building in 25 years worth to me?" For my client, that question had an obvious answer. The BDC (Business Development Bank of Canada) made the deal possible by financing 100% of the purchase price — meaning no down payment required and no drain on the business’s operating reserves. That removed the biggest barrier most business owners assume they face.
What BDC Commercial Financing Actually Means Most business owners have heard of the BDC but associate it with working capital loans or lines of credit. Using it to purchase commercial real estate is less well-known — and that’s a real missed opportunity for Quebec entrepreneurs. Here’s what BDC commercial real estate financing looks like in practice: BDC offers long-term loans specifically for owner-occupied commercial property. Loan terms can stretch to 25 years, which keeps monthly payments manageable. Rates can be fixed or variable. And for qualified borrowers, BDC can finance the full purchase price — which is what made this deal work for my client. The Canada Small Business Financing Program (CSBFP) is another option worth knowing. It can cover up to $1 million for real estate purchases and is accessible through most major Canadian banks. While it doesn’t go to 100% on its own, it can be combined with other financing to reduce or eliminate the down payment burden. For mixed-use commercial/industrial properties in Quebec specifically, owner-occupied financing is often a natural fit. The property must be primarily used by the business, and lenders generally want to see stable business financials. A good commercial real estate agent — paired with a lender who understands BDC programs — can tell you quickly whether you qualify. One practical note: BDC has offices across Quebec including Montreal, making it straightforward to get a preliminary conversation started before you’ve even identified a property.
The Benefits Nobody Talks About The financial case for buying versus leasing is compelling on its own. But there are benefits that go beyond the monthly payment comparison that business owners often don’t consider until after they’ve made the move. You control the space. When you own your building, you can modify it to fit your operation — no landlord approval required. For industrial or specialty commercial users, this alone is worth a significant premium. No lease renewal uncertainty. Every business owner who has negotiated a commercial lease knows the anxiety of renewal time. Your landlord knows your options are limited. You’re negotiating from weakness. Ownership eliminates that dynamic entirely. Your payment doesn’t inflate. Commercial leases often include annual rent escalations — 3% per year is common. On an $11,500/month lease, that’s over $4,000 more per year by year five. A fixed-rate mortgage payment stays the same. The building becomes an asset. Over time, commercial real estate in a growing market appreciates. When you eventually sell the business, the property can be sold separately — often becoming one of the most valuable things you’ve built. You can lease out extra space. If your operation doesn’t fill the whole building, you can lease the remainder to another tenant. That income offsets your payment — and in some cases, covers it entirely.
Is Buying Commercial Space Right for Your Business? Buying isn’t the right answer for every business at every stage. Here are a few indicators that it’s worth exploring seriously:
Your current or upcoming lease is expiring and renewal terms are unfavorable You have specific spatial, zoning, or operational requirements that are hard to find in the lease market Your business is stable enough that a 20-25 year commitment feels reasonable You’ve been in the same market for several years and plan to stay Your monthly lease payment is $3,000 or more (the economics of ownership generally improve at higher payment levels)
If several of those apply to you, a conversation with a commercial real estate professional and an SBA lender is worth an hour of your time. The math might surprise you — just like it surprised my client.
Ready to explore buying vs. leasing for your Montreal business? Contact the team at Immodev Montréal. We work with business owners across Greater Montreal and the South Shore to find the right commercial real estate strategy. Let’s talk about your options.