Christine Sheffield, founder and owner of Platinum Container, had been leasing space for her business for over 15 years. She couldn’t be more grateful for the day the stars aligned and, with the help of an SBA 504 loan, she was able to purchase a 4,560 square foot industrial building for her business with only 10 percent down.
“We had been searching for a building for over five years,” said Sheffield, who founded her company, a manufacturer and distributor of custom boxes, in 2006. “Freestanding industrial buildings are really hard to come by in this area. Miraculously, we finally found a perfect building for our business and was able to convince the owner to sell it to us.”
The U.S. Small Business Administration (SBA) 504 loan program allows small business owners to finance or refinance commercial real estate and other fixed assets with below-market, fixed interest rates fully amortized over 25 years. Renovations, equipment, closing costs and soft costs can also be financed.
“Our interest rate is unbelievable,” Sheffield states. “Between the amazing rate, the 10 percent down payment, and all the help we gained along the way, the SBA 504 Program was absolutely the best route we could have taken. I’m not sure we could have done it without the support we received from the TMC Financing team and Peter Drake with Bank of America, who administered our first mortgage. The process was seamless, so easy, and overall incredible.”
The SBA 504 loan is a second mortgage loan guaranteed by the SBA. The first mortgage is provided by a conventional lender, representing approximately 50 percent of the total project cost. The SBA 504 second mortgage represents 40 percent of the total project cost. Monthly payments are fixed for the life of the loan, providing business owners with affordable payments that enable them to control overhead costs for the long term. Today’s SBA 504 interest rate is a remarkably low 3.46 percent for 25 years.
According to Jennifer Davis, senior vice president of business development at TMC Financing in Southern California who administered the 504 loan, when a small business owner invests in their real estate, their future is more secure and the return is fruitful. “Platinum Container was an ideal candidate for 504 financing. Their business was thriving but unable to expand to their potential because of logistical limitations. They now have a building to call their own that has enabled them to maximize efficiency and increase their offerings.”
Platinum Container offers professional packaging services, from design to production, to the greater Los Angeles area. Their newly acquired building, located at 441 Park Industrial Drive in La Habra, replaced all three of their leased locations, helping the flow of their business tremendously. The building features office space, two roll up doors, and enough space to accommodate their machinery and equipment.
“It feels amazing to be a part of the building owner community,” Sheffield states proudly. “Being a business owner holds a lot of responsibility that I do not take lightly. The livelihood of our employees is in our hands. Owning this building makes everyone’s future brighter and more secure.”