Go Green and Save Big
Small businesses looking to grow and expand their operations through the purchase or construction of commercial real estate and “go green” can qualify for as much as $5.5 million SBA 504 financing (up to 40% of total project costs) under the Energy Public Policy Goal, offered through Business Lending Partners.
There is no limit on the number of SBA 504 green projects allowed to each borrower, unlike the “regular” SBA loan whose maximum eligibility limits is $5 million per borrower and all of its affiliates including all 7 (a) and 504 loans. This means businesses that previously reached their SBA maximum limits have the ability to receive additional loans under the SBA’s Energy Public Policy Goals
Benefits of the SBA Green 504 loan program include
- As little as 10% equity injection
- Up to $5.5 million SBA 2nd mortgage portion per project with no maximum total project limit
- Ability to finance multiple SBA Green 504 projects
- SBA 504 financing have competitive, fixed interest rates and 10- to 20- year amortization
- The usual SBA’s job creation/retention requirements can be waived
- Project-related fees and soft costs can be financed in the loan
Businesses need only to meet one of the following goals to qualify for the SBA Green 504 Loan
Acquisition or construction of a replacement facility or retrofit of a currently owner-occupied or leased existing facility with energy saving technologies. Examples include improved insulation, lighting, HVAC systems, and energy efficient windows, etc.
Upgrades to plant, equipment and process that produce at least 10% renewable energy sources used to run a facility or renewable fuel producers, including bio-diesel and ethanol producers. Examples include installation of solar power, wind power, hydropower, biodiesel, ocean thermal, etc.
If historical energy consumption records for the property are not available, a project can qualify if it is built or retrofitted using LEED certification standards through the completion of upgrades (qualify for maximum $5 million per project). Sustainable Design or LEED certification do not by themselves qualify a building for the program.
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