SBA 504 Loans

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CDC/SBA 504 Loans

The CDC/SBA 504 loan program is for small businesses looking to buy or build owner-occupied commercial real estate. The program pairs two lenders together to fund these projects, a bank or traditional lender and a community development corporation (CDC). The bank lends up to 50% and the CDC lends up to 40%, while the remaining 10% of the project’s costs come from the borrower, typically in the form of a cash down payment.

CDC/SBA 504 loans require that the business occupy at least 51% of the commercial space. So, while this is a great opportunity to rent out 49% of your new building to tenants, it’s only right for companies that actually expect to use the space as one of their key locations.

CDC/SBA 504 Loans at a Glance

Loan Amounts Up to $14 million
Repayment Terms 10 or 20 years
Minimum Requirements 680+ Credit score
10% Down payment
Meet job creation or public policy goals
Real estate must be at least 51% owner occupied
Use of Loan Proceeds Owner occupied commercial real estate purchase, construction, or renovation
Purchase of other fixed assets