How much commercial space can a condo project have?

Under Fannie Mae Selling Guide B4-2.1-03, commercial or mixed-use space may not exceed 35% of the condo or co-op project, or 35% of the building in which the project is located. The lender determines the applicable square footage and calculation.

What enters the calculation?

The Guide divides total nonresidential square footage by total project or building square footage. Space above and below grade counts. Rental apartments, hotels, restaurants, and private membership-based fitness facilities are examples of nonresidential space.

Commercial parking facilities may be excluded. Residential amenities may also be excluded when they are residential in nature, designated for the exclusive use of residential owners, and owned by the unit owners or HOA. The Guide includes additional ownership, control, location, and shared-association rules, so a floor-plan label alone is not enough.

What should the board gather?

Start with:

• total project and building square footage;
• square footage and use of every nonresidential area;
• ownership and control of those areas;
• whether residential and commercial uses are in the same building; and
• source documents supporting the measurements.

This page explains the current Fannie Mae criterion only. It does not measure a project, decide which geometry applies, address every flood-insurance issue, or determine eligibility.

Sources

• Fannie Mae Selling Guide B4-2.1-03, Ineligible Projects, version August 5, 2026 — Commercial Space and Mixed-Use Allocation.

Primary source accessed September 11, 2026.