TMC Financing Helped California Motorcycle Dealership Expand through SBA 504 Green Energy Program

Andrew Westbrook and John Lund co-owners of Eagle’s Nest Harley-Davidson in Lathrop, CA, know a thing or two about speed. Over the years in the powersports industry, the duo have built up three of the most successful dealerships in the global Harley-Davidson network.

Owning property for the business was a big part of Eagle’s Nest’s growth.

In March of 2014, Westbrook and Lund made their first big move. Using an “acquisition loan” from Harley-Davidson, they purchased a dealership and over time they tripled that dealership’s volume and headcount.

Now, it’s one of the top 25 Harley-Davidson dealerships in the United States.

However, the partners knew if they wanted to continue to amplify their business, they would need a larger, more flexible real estate loan. Thankfully, they chose the Small Business Administration’s (SBA) 504 Program.

Future-Proofing the Business” was Essential to Eagle’s Nest Harley-Davidson

Westbrook and Lund’s initial acquisition loan left them with some challenges. With a 7-year lease and three 5-year options to extend, they found themselves renegotiating rent regularly. 

The partners decided it was time to find a real estate financing option that would allow them to switch from tenants to property owners. Utilizing the 504 program to purchase property for their dealership, would eliminate volatile and unexpected rent increases.

When you purchase your building with a 504 loan, you are married to that payment for 15, 20, 25 years – there are no increases,” Westbrook explains. “For the stability of the business it made sense to utilize the SBA 504 Program.”

The SBA 504 Loan Program Helps Businesses Buy Commercial Properties at Affordable Rates

Most for-profit businesses qualify for the SBA 504 loan program offered by TMC Financing. This affordable and accessible commercial real estate loan offers down payments as little as 10%, coupled with a below-market, fixed interest rate for 25 years.

Westbrook and Lund already had some experience with the Small Business Administration because they previously used an SBA loan to purchase their dealership in Washington state.

The 10% down payment was decisive in making it all possible.

There is a substantial amount of capital involved when operating a new business,” explains Westbrook. “Our original SBA loan allowed us to secure a 10 percent down payment rather than 25 percent – this is a significant amount of savings. We were able to purchase property and conserve working capital to put toward other business expenses.”

When it was time to expand even further, the SBA 504 loan program was a natural choice. However, Eagle’s Nest was running up against the SBA’s lifetime loan limits.

With Help from TMC Financing, Eagle’s Nest Financed its Growth through SBA 504 Green Energy Program

Eagle’s Nest Harley-Davidson was in a great financial position. However, the owners were unwilling to settle for a conventional loan with a high down payment and other onerous restrictions. A colleague suggested they speak to Jim Azevedo, TMC Financing’s senior vice president of business development, to explore their options. It turned out to be a fateful conversation!

Azevedo suggested they take advantage of the SBA 504 Green Energy Program and add energy-efficient features to the new construction. By including green technology in an acquisition project, a borrower can exceed traditional loan limits.

Eagle Nest qualified for the energy efficiency program by installing rooftop solar panels, which cut their energy consumption by 10 percent. By choosing this financing option, Eagle’s Nest could finance the entire project and enjoy the benefits of the 504 loan’s attractive 10 percent down payment.

Jim Azevedo
Jim Azevedo, SVP, Business Development

“Under the SBA’s energy efficiency program, the 504 portion of the financing package is increased to a maximum of $5.5 million,“ explains Azevedo. “In addition, there is no limit on the total project cost, so many projects over $25 million can still qualify for 10 percent down, even with outstanding SBA loans.”

Would Westbrook recommend TMC Financing’s SBA 504 loan program to others in his industry?

“Absolutely, I definitely would,” Westbrook states without hesitation. “Especially when you’re focused on your business, you don’t even know where to begin to look for financing options sometimes. Everyone at TMC Financing reacts very quickly.”



About TMC Financing

TMC Financing is the no. 1 provider of SBA 504 commercial real estate loans in the nation, helping small businesses expand throughout California, Nevada, Oregon and Arizona. Founded in 1981, TMC has funded projects worth more than $12 billion. About 6,000 businesses have benefited from this financing, resulting in the creation of an estimated 60,000 jobs.