Acquisition and development financing, involving a SBA “Certified Development Company” (CDC), provides you with long-term, fixed-rate financing for major fixed assets (land, buildings, etc.). This program contributes to community economic development. The CDC works with commercial lenders to provide another financing option to businesses.
This program includes a loan from a commercial lender that covers 50% percent of the project and a second loan for up to 40% of the project cost from the CDC that is 100% SBA guaranteed for a combined 90% LTV.
Acquisition and development financing is an excellent option for a business that is looking to acquire more land to expand their current operations. The government supports this program because they understand the kind of economic impact a growing business can have on a community.
Funding from an acquisition and development program can be used for:
• Purchasing land and improvements, including existing buildings
• Grading, street improvements
• Utilities, parking lots and landscaping
• Construction of new facilities
• Modernizing, renovating or converting existing facilities
• Purchasing long-term machinery and equipment
The loan program cannot be used for: Working capital or inventory, consolidating or repaying debt, refinancing, employee wages, or marketing expenses.