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504 Program

Borrower Benefits

  • Low 10% injection to project (additional 5% for special purpose and/or start-up)
  • Long, fully amortized repayment (20 years for real estate/ 10 years for M&E)
  • Frees up cash flow and preserves cash for working capital needs
  • Lock in low, bond market fixed rates for 20 years (10 years for M&E)
  • Build for future needs and lease space until needed
  • 504/CDC fees are covered in debenture proceeds; no up front commitment fees

Use of Proceeds

  • Commercial Real Estate - for purchase, construction or renovation/expansion for owner-users.
  • Machinery & Equipment - major M&E purchase (useful life to exceed 10 years); M&E purchase may be combined within the 20 year real estate debenture

Eligibility Requirements

  • Operating company Net Income under $2.5 million (2 year average)
  • Tangible Net Worth of less than $7.0 million
  • Owner-user occupied of at least 51% existing building or 60% of new construction with occupancy of additional 20% within 10 years
  • Must meet project eligibility under job creation goal or other public policy goals
  • Other requirements mirror SBA 7a program eligibility such as for-profit business


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