Business Finance – Page 3 – SEDA Council of Governments

Sports center built with SEDA-COG and Juniata Valley Bank partnership

Posted on July 13, 2020 by DNS Admin

STATE COLLEGE – An entrepreneur’s dream of building a sports facility became reality thanks to a loan partnership with SEDA-Council of Governments (SEDA-COG) and Juniata Valley Bank.

The agency and bank partnered with owner Michael Lee to help fund the creation of Nittany Valley Sports Centre at 177 Champion Dr. Investment partners also helped finance the project. This created six full-time jobs and 10 to 20 part-time jobs, depending on the time of year.

“I’m excited to offer this opportunity for kids and everyone to play sports – that’s important,” Lee said.

The indoor sports and multipurpose facility has offerings for almost every occasion. The area’s competitive and recreational soccer organizations use it to participate in leagues, training, and facility rentals. The Centre offers athletic training through a Parisi Speed School franchise, along with sports clinics, sports tournaments, and summer youth sports camps. The Centre is available for other sports and non-sport activity rentals such as summer camps, birthday parties, school rentals, preschool programming, and more.

While Lee was an architectural engineer by education and trade, he came to realize it wasn’t his passion. After taking his daughter to a gymnastics competition in a large indoor sports facility, he saw the variety and opportunity a sports center offers.

“I thought, why doesn’t State College have a place like this? I asked around, and people said the area has needed a place like this for years. So, I hired a consultant to do a market study which showed it could support this,” Lee said.

However, because of the scale of the project and Lee’s lack of experience in that arena, banks were reluctant to fund the project alone. SEDA-COG bridges that gap and helps to spread the risk by offering various loans in addition to traditional lender financing.

John Reichard, SEDA-COG loan officer, said SEDA-COG was pleased to help make Lee’s project come to fruition.

“Michael faced many challenges to bring this project to reality since he first envisioned it. We were thrilled to bring a solution to the table to help him overcome some financing obstacles. His persistence and optimism are the hallmark of his success,” Reichard said. “Juniata Valley Bank was a fantastic partner in this project, as well.”

SEDA-COG secured a $2.4 million U.S. Small Business Administration (SBA) 504 loan which offers low down-payments, long terms, and fixed rates. Juniata Valley Bank financed the project with a $4 million loan.

“This made the bank more favorable toward loaning to the overall project cost. That’s the reality – we couldn’t have done it without the SBA component and SEDA-COG. SEDA-COG exists to make it easier, and they did,” Lee said.

Fred Wallace, bank vice president relationship manager, said it was an exciting project and are proud project partners.

“We are excited to be partners with Michael on his journey; we believe in the project. We’re thrilled to see that it’s taken off and running,” Wallace said. “Our partnership with SEDA-COG was first rate; we appreciate all the time and effort that John Reichard put into this project, not only with Michael, but also with us. We look forward to having a long-term relationship with Michael and SEDA-COG.”

The Centre opened in February 2019 and Lee is building a second phase addition that will support in-house basketball and volleyball, as well as a wide range of events including sports tournaments, trade shows, conventions, and more. This phase is funded by a state grant and is expected to open in November.

While Lee is from Vermont, he attended Penn State University and moved to State College permanently in 1998.

For more information about Nittany Valley Sports Centre, visit www.thecentrepa.com.

The SEDA-COG Local Development Corporation, located in Lewisburg, is a Certified Development Company providing SBA 504 loans throughout the state of Pennsylvania. For more information, visit www.sedacogldc.org, email sba@seda-cog.org, or call 570-524-4491 and ask for the Business Finance Department.

Information Box:

SBA 504 loans: Long-term, fixed-rate financing to acquire fixed assets for expansion or modernization or to refinance existing real estate or equipment debt.

Benefits of SBA 504 loans:

- · Long-term, fixed-rate financing (10 years for equipment and 20 or 25 years for real estate)
- · Lower down-payment vs. conventional financing (as low as 10 percent for existing businesses)
- · Financing up to 40 percent of eligible costs (land and building purchase, building construction, building renovations, equipment, refinancing of real estate or equipment debt)
- · Loan is fully amortized (no balloon payment)

Eligibility: For-profit businesses with a net worth less than $15 million and net income less than $5 million.

SEDA-COG Offers Businesses New Loan Program

Posted on April 24, 2020 by DNS Admin

Businesses impacted by the COVID-19 crisis in 11 central Pennsylvania counties now have another funding option – a new loan program established by SEDA-Council of Governments (SEDA-COG).

No payments are due in the first six months for the new SEDA-COG EDA COVID-19 Loan Fund. There is a limited pool of funds available – $400,000 – so interested businesses should apply now. Funds are available until they are exhausted.

SEDA-COG Executive Director John Brown said SEDA-COG worked hard to secure these funds through the U.S. Economic Development Administration (EDA) and thanked them.

“We know businesses are hurting and we are using creative solutions to help meet the current needs in this ever-changing economic climate,” Brown said. “As the local community and economic development agency, we are thrilled to partner with the EDA to further assist our region.”

Doug Wilburn, director of SEDA-COG’s Business Finance program, worked with the EDA to get these funds reallocated for a broad array of businesses since they were originally limited to specific business sectors.

“This loan fund was reallocated by SEDA-COG in response to the COVID-19 crisis. The partnership of SEDA-COG and the EDA will give businesses in our region some relief. SEDA-COG has heard the voice of our communities and we will continue to look for ways to help local businesses through these trying times,” Wilburn said.

The loans are for businesses in SEDA-COG’s region of Centre, Clinton, Columbia, Juniata, Lycoming, Mifflin, Montour, Northumberland, Perry, Snyder, and Union counties.

For-profit businesses can apply for loans of at least $10,000 with an interest rate of 3.25%.

Funds can be used for working capital and can be disbursed based on past working capital expenses.

There is a $500 underwriting fee and a $100 filing fee. For more information, visit https://seda-cog.org/covid-19/ or contact SEDA-COG’s Business Finance Department at cwca@seda-cog.org.

Glass House Inn has new ownership thanks to SEDA-COG financing

Posted on June 20, 2019December 30, 2019 by DNS Admin

ERIE – The Glass House Inn is under new ownership, thanks to a loan partnership with SEDA-Council of Governments (SEDA-COG) and Northwest Bank.

Nigam Bhavsar bought the motel at 3202 W. 26St. from the prior third-generation owners with this financing. The inn had previously been updated including the carpeting, mattresses, and 32-inch TVs in each room, along with offering free Wi-Fi. The inn also has a well-maintained outdoor pool.

As a result of the project, two full-time jobs will be created.

The loans through SEDA-COG offered the low interest rates and long terms Bhavsar needed to make his business endeavor successful.

The $281,700 Small Business Administration (SBA) 504 loan offered a fixed 20-year low interest rate, and the $60,000 SEDA-COG TEAM loan also had the benefit of a fixed low interest rate.

Bhavsar said John Reichard, SEDA-COG senior relationship manager, was helpful throughout the process.

“Everyone at SEDA-COG was very responsive and professional when answering all my questions. John Reichard was very knowledgeable with the SBA 504 program and walked me through the details of the program,” Bhavsar said.

Northwest Bank partnered with SEDA-COG on the project with most of the financing.

Paul Kruszewski, Northwest Bank business banker, said the partnership made for a “winning solution” for the borrower.

“SEDA-COG was instrumental in providing a financing solution for Dattam Hospitality LLC (Nigam Bhavsar). By offering an attractive rate and borrower-friendly terms, Northwest and SEDA-COG provided a winning solution to our borrower,” Kruszewski said. “The staff at SEDA-COG was very timely and informative, allowing for an easy loan approval process. I look forward to partnering with John Reichard and SEDA-COG on future opportunities.”

For more information about the Glass House Inn, visit www.glasshouseinn.com.

To start a financing partnership with SEDA-COG, call 1-800-332-6701 and ask for the Business Finance department or email John Reichard at jreichard@seda-cog.org.

Northwest Bank is a full-service financial institution that offers a complete line of personal and business banking products, loans, investment management, trust and insurance services and employee benefits from 172 full-service locations across Pennsylvania, New York, and Ohio. Northwest Bancshares Inc. is the holding company of Northwest Bank and is listed on the NASDAQ Global Select Market as NWBI. For more information, visit www.northwest.com.

SEDA-COG’s Business Finance Department serves the entire state of Pennsylvania for the SBA 504 program. For Pennsylvania Industrial Development Authority (PIDA) and SEDA-COG loans, SEDA-COG serves 11 central Pennsylvania counties: Centre, Clinton, Columbia, Juniata, Lycoming, Mifflin, Montour, Northumberland, Perry, Snyder, and Union.

Small business loan program hits record-low interest rate

Posted on June 17, 2019December 30, 2019 by DNS Admin

Good news for new or expanding businesses – a federal loan program’s interest rate is the lowest in the program’s history.

The Small Business Administration (SBA) 504 loan program’s 20-year effective fixed rate for June is 3.98%, the first time it has fallen below 4%. Rates for other term options are also at or near recent lows. The rates have decreased for the past six months and have been below Prime for seven months. Rates are set monthly for loans that have closed the previous month.

SEDA-Council of Governments (SEDA-COG) partners with banks to offer businesses statewide this long-term, fixed-rate financing that can be used to acquire fixed assets for expansion or modernization or to refinance existing real estate or equipment debt. SBA 504 loans can be as small as $100,000 up to $5 million (in some cases $5.5 million).

Benefits of SBA 504 loans:

Long-term, fixed-rate financing (10 years for equipment and 20 or 25 years for real estate)

Lower down-payment vs. conventional financing (as low as 10% for existing businesses)

Financing up to 40% of eligible costs (land and building purchase, building construction, building renovations, equipment, refinancing of real estate or equipment debt)

Loan is fully amortized (no balloon payment)

Reduces risk for the partnering lender

For-profit businesses with a net worth less than $15 million and net income less than $5 million may be eligible. For real estate financing, the business must occupy a majority of the space.

John Reichard, SEDA-COG senior relationship manager, said the SBA 504 loan program is a proven success and win-win-win for the small business, the community and participating lenders.

“Businesses tell us again and again how the SBA 504 low interest rates and long terms help with cash flow and empower them to expand when it otherwise might have been difficult,” Reichard said. “This in turn promotes economic development in our communities.”

SEDA-COG provides SBA 504 loans throughout the state of Pennsylvania. For more information, visit www.sedacogldc.org or call 570-524-4491 and ask for the Business Finance Department.