Local Company Buys Vacant Industrial Building Using SBA 504 Program
Small Business Administration (sba) 504 Loan
The SBA 504 loan program partners with a financial institution to create an attractive financing package to benefit businesses. Working together with the SBA and Business Lending Partners, growing businesses throughout Wisconsin can receive affordable, long-term, fixed-rate financing to expand operations and create job opportunities.
A typical SBA 504 Loan (including the one in this case study) is structured as 50% from the bank at the bank’s rate, 40% from the SBA at a long term, fixed-rate, and 10% equity from the borrower.
Minority-Owned Business Purchases Vacant Building
The purpose of this SBA 504 loan is to assist a local health and safety company with a building purchase, along with new equipment and minor renovations. After acquiring two competing businesses, the company outgrew its previous location.
The borrower has over 30 years of experience in the market, along with proven management experience. This project provides a minority-owned business with the means to own and occupy a vacant building.
The company currently has 14 employees. As a result of project completion, they will create two full-time jobs. Utilizing the SBA 504 Loan Program, in partnership with Educators Credit Union, the company found the ideal financing solution to meet their growing needs.
WHAT WAS UNIQUE ABOUT THIS LOAN? - Karmin Garstecki, Loan Officer
- Long-established local business that can now own and plant roots in community
- Able to purchase new equipment for better inventory management
- Minimal work needed for the business to relocate quickly