Inland Empire Lease Rates on the Rise


The Solution – Purchase Property with SBA 504 Program

The Inland Empire remains one of the most dynamic industrial real estate markets in California. According to a new report from Jones Lang LaSalle, Inland Empire’s rent prices continue to rise, with more than a 50 percent increase in the past five years and an even stronger surge at the close of 2020.  The source of this recent growth stems from the pandemic’s heightened demand for e-commerce and delivery.  Corporations have had to redesign their network to accommodate the consumer’s need for home deliveries. The Inland Empire has a thriving industrial landscape and the capacity to develop land into new industrial spaces.  As a result, industrial lease prices are skyrocketing, and vacancy rates are dropping to record lows.

Rising occupancy costs can be detrimental to the Inland Empire small business owners who are currently leasing property during the post-pandemic era. Business owners could subject to rent spikes and potentially being priced out of their buildings.  To hedge against this booming market, it is more important than ever that business owners realize the benefits of purchasing their building. Fortunately, with the Small Business Administration’s (SBA) 504 loan program business owners can affordably finance a building purchase and stabilize their occupancy costs for the long term.

The SBA 504 loan allows small and medium sized businesses to finance the purchase, construction, or improvement of commercial real estate with long-term, below-market, fixed interest rates. Business owners that purchase their building through the SBA 504 program will gain stability and peace of mind knowing the potential rent increases brought forth by pandemic recovery will not drive them out of the area.

Why choose the SBA 504 Loan for Real Estate Purchase?

Low Down Payment

The 10 percent down payment is one of the best features of the SBA 504 program. In some cases, such as if the property is a single use property, or if the business is less than two years old, owners may be required to provide a 15 percent down payment.  In either case, the down payment is much less than a conventional loan, which can be as high as 40 percent.

Below Market, Fixed Interest Rates 

The interest rate on a 504 is below-market, long-term and fixed. The rate is unaffected by market instability or inflation expectations, which could cause a spike in monthly payments.  The 504 loan guarantees fixed, low monthly payments for 25 years, with no final balloon payment.  The current rate as of March 2020 is 3.08%.

Ability to Finance Equipment 

The SBA 504 loan program also allows business owners to finance equipment and other fixed assets, such as fixtures, furnishings and machinery with a service life of at least 10 years.

Equipment financing examples include:

  • Manufacturing equipment
  • Commercial printing equipment
  • Food processing machinery
  • Medical & dental equipment
  • Lab & technical equipment
  • Gym & fitness equipment
  • Laundry & dry cleaning equipment
  • Hotel furnishings and fixtures


The 504 loan is assumable, If the owner decides to sell their building, the buyer/new owner would gain the benefit of the below-market, fixed interest rate that came with the original loan.


One of the best aspects of the 504 program is nearly all for-profit businesses are eligible.  However, the business must occupy at least 51 percent of the building.  If the financing is for the construction of a new building, the business must occupy 60 percent of the building.

3 Month Payment Subsidy

The Economic Aid Act of 2021 includes enhancements and incentives that make the Small Business Administration’s (SBA) 504 Program even more attractive. This Act states that for new SBA 504 loans, approved from February 1, 2021 thru September 30, 2021, borrowers will receive three months of payments subsidies. This means the SBA will be making your loan payments for the business owner and they will not need to be paid back at any time. This loan forgiveness is capped at $9,000 per loan per month.

The SBA 504 program & Support from Certified Development Company

A Certified Development Company (CDC) is a nonprofit corporation built to support economic development within its community through the SBA 504 Loan Program. CDCs are regulated by the SBA and strive to be the owner’s advocate throughout the life of the loan. CDCs complete the SBA paperwork and guide the business owner through the entire loan process.

TMC Financing is the No. 1 CDC in the Western United States and has ranked in the top five CDCs nationwide for two decades. During the past 40 years, TMC has provided over $10 billion in financing for more than 6,000 businesses throughout California, Nevada and Arizona.

TMC Financing’s loan experts can facilitate the 504 loan process to help business owners acquire property, grow their business and solidify financial security for the long term.


To learn more about utilizing the SBA 504 Program to buy a building in the Inland Empire, contact:

Jennifer Davis

Senior Vice President








TMC has helped nearly 1,000 business owners own their own building in Nevada.