COMMERCIAL REAL ESTATE ALLIANCE
Commercial Lending During a Pandemic By: John Hanlon, SBA Lending Specialist
C
learly, our vision of the future today is much different than what we were dreaming of even back in January of this year. The global COVID-19 pandemic is rapidly causing us to change our habits and our thinking in everyday life.
“The future ain’t what it used to be,” Yogi Berra. The work from home environment for traditional white-collar jobs could change the need for office space in the future as companies might feel the benefits outweigh the negatives. While there may be a need for an office space maybe that space will be smaller, and shared with other workers on a come in as-needed basis. Traditional brick and mortar retail stores, already under pressure from online sales, will have to adjust as well to draw customers back into their locations or increase their online selling ability. At the moment, most lending is either on hold until things improve or the funding completed for the Paycheck Protection Program loans. As of May 30th, the SBA, through the lending institutions, has issued 4.4 million loans in excess of $510 billion. In 14 days, the SBA processed 14 years worth of loans. Meanwhile, some conventional sources of funding are taking a wait-and-see approach while the SBA 7a and 504 loan programs are still active.
In an effort to help small businesses obtain loans through the SBA, the Federal Government is stepping in to make the first six months of payments on new loans approved now until the end of September. That is a great start for anyone on the fence about buying a property for their business, refinancing debt, or buying a business. The SBA loans also offer a low down payment option, typically between 10-15 percent, depending on property type and loan purpose. This combination of a lower down payment and historically low-interest rates can help turn your prospects into buyers.
“Change is the law of life and those who look only to the past or present are certain to miss the future,” John F. Kennedy During past economic disruptions, people still started businesses, purchased property, expanded their existing business. While it may take a while to get back to previous growth levels, there are still opportunities to be had. We just have to get creative on how we can make it a win-win for our clients. We have to change how we have done business in the past and embrace new opportunities in the future. If you have any questions, on how SBA lending can help you or your clients, reach out to your local SBA Lending Specialist. •
22 | ELEVATE [ JULY 2020 ]
