San Francisco Art Studio Owner Grateful for SBA Assistance Amidst Coronavirus Pandemic

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Owner of SMAart Gallery and Studio purchased his San Francisco condo with an SBA 504 Loan administered by TMC Financing. He wanted to become a property owner for stability and peace of mind of having his own space. Following the coronavirus pandemic, he is eager for business to return to normal yet grateful for SBA assistance while business is down significantly.

Owner of SMAart Studio and Gallery conducts outdoor classes during pandemic

Property ownership has given Steve stable operating costs and a valuable asset that will be beneficial for years to come

Steven Allen, owner of SMAart Gallery and Studio in San Francisco eagerly waits for business to return to normal. He started his business in 2012 to fulfill his lifelong dream of having a place to learn, share, and create art. He purchased a condo in San Francisco to gain stability for his business. He wanted peace of mind knowing that the space was his, his occupancy costs were stable, and no landlord could uproot him without warning, a scenario all too common for San Francisco businesses.

Allen, an award-winning ceramic sculptor, was able to achieve this peace of mind in February of 2020 thanks to the Small Business Administration’s (SBA) 504 Program, which enabled him to become a property owner with only a 10 percent down payment.

“I utilized the SBA 504 Program because of the low down payment. Being able to retain working capital was so helpful. If I didn’t take advantage of the SBA 504 program, I would have been looking at a down payment of about 30 percent.”

The SBA loan financed the $1.4 million acquisition of a 2,480 square foot condo located at 3135 24th Street in San Francisco, CA. Allen also obtained a historically low SBA 504 interest rate, fixed for 25 years. Bruce Whitaker of TMC Financing facilitated the SBA portion of the deal.

“Steve has such a special business,” states Whitaker. “He is a passionate artist and wants to share his passion with the San Francisco community. I was thrilled we could secure financing that would allow him to purchase a home for his studio. Property ownership has given Steven stable operating costs and a valuable asset that will be beneficial for years to come. He was also able to tailor the space to work best for his business.”

The space consists of three areas. There is gallery exhibit space, studio space, and community space for ceramic classes and team events.

“Shortly after we purchased the condo, covid hit,” stated Allen. “When we were allowed to open, we adapted our business model to offer outdoor classes and more private space with barriers so artists can work independently and safely. Business is down 75 to 85 percent though so the debt forgiveness from the SBA was extremely helpful.”

The SBA gave existing SBA borrowers six months of debt forgiveness in the 2020 CARES Act. In the new legislation that passed, the Consolidated Appropriations Act of 2021, qualified borrowers will be able to receive an additional six months of debt forgiveness.

“On top of the unbeatable terms of the 504 loan – the other great thing about the program is that the SBA has your back when something crazy, like the coronavirus, happens,” states Whitaker. “The debt forgiveness plus the expanded refinancing options included in the Consolidated Appropriations Act will help many of our cherished small businesses survive.”
About SBA 504 real estate loans

The U.S. Small Business Administration 504 loan program allows small-business owners to finance or refinance commercial real estate and other fixed assets with long-term, below-market, fixed interest rates. SBA 504 loans can be used to finance the total project cost (TPC), which can include the purchase price, construction/renovations, equipment, soft costs and closing costs. A typical 504 loan project requires a down payment of only 10 percent of the TPC from the borrower, with the remaining amount split between a first mortgage provided by a commercial lender and a second mortgage provided by a certified development company (CDC). By enabling owners to keep their capital working to grow the business and create jobs, the 504 program provides long-term stability to both businesses and communities.

About TMC Financing

Founded in 1981, TMC Financing is the No. 1 provider of SBA 504 commercial real estate financing for the Western Region of the United States. The company has secured financing for projects worth more than $10 billion across California, Nevada, and Arizona. More than 6,000 businesses have benefited from this financing, resulting in the creation of an estimated 60,000 jobs. For more information on SBA 504 loans and the local businesses they support, visit http://www.tmcfinancing.com.

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Lindsey Paley
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