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March 9, 2021
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Business Review Western MI
Business Review Western MI
SBA Lending
(2007-04-25)
(wgvu) - Seeing the potential for further growth, a Lansing company that
coordinates U.S. Small Business Administration lending is planning a
much larger presence in western Michigan.

The Michigan Certified Development Corp. is hiring a commercial lender
to focus solely on western Michigan and plans to eventually open an
office in the market.

The top writer of SBA 504 loans in Michigan, the MCDC generates five to
10 percent of its annual volume from a western Michigan territory that
includes Grand Rapids, Kalamazoo, Benton Harbor-St. Joseph, Battle
Creek, Holland and Muskegon.

MCDC President Jane Sherzer would like to grow the western Michigan
volume to 15 to 25 percent of all loans within a few years.

We certainly do plenty of projects in west Michigan and we are
definitely planning to do more, Sherzer said. There's plenty of
business to be had out there.

The MCDC is one of six certified development companies operating
Michigan including three that are located in western Michigan that
market small business loans available through the SBA's 504 lending program.

Under 504, small businesses can borrow up to $1.5 million for up to 20
years at below-market interest rates to finance capital projects, or up
to $4 million for certain qualified projects. Borrowers must provide 10
percent of their capital needs. Forty percent is financed through the
SBA, and the final 50 percent comes from a bank loan.

The MCDC has grown steadily in recent years, last year writing 87 valued
at $47.5 million more than twice that of two years earlier.

Through March 31, the midway point of the federal government's 2007
fiscal year, the MCDC led the state in 504 lending with 36 loans
collectively valued at $17.9 million. That compares with 44 loans for
$21.9 million at the same time a year earlier.

In venturing further into western Michigan, the MCDC will compete
directly with the three certified development companies already actively
working the market: the Economic Development Foundation in Grand Rapids,
Holland-based Lakeshore 504 and SEM Resource Capital that has offices in
Grand Rapids and Detroit.

Sherzer doesn't see the additional focus on western Michigan as
competing against the other certified development companies. It's about
increasing the use of SBA 504 lending that lags in Michigan compared to
other Great Lakes states, she said.

The market is nowhere near saturated. There's huge opportunity, she
said. There's no question there's plenty of growth in western Michigan
and plenty of opportunity for our program to be used.

The MCDC recently added a lender to focus on the northern Michigan
market and plans to open an office soon in Macomb County in suburban
Detroit.
--

SBA lending drops

Lending via the U.S. Small Business Administration's 504 lending program
is down through the first six months of the fiscal year, compared to the
same period last year.

Through March 31, the six certified development companies in Michigan
that coordinated SBA 504 lending wrote 99 loans valued at $51.4 million.
That compares with 127 loans valued at $61.7 million midway through the
2006 fiscal year.

Jane Sherzer, president of the Michigan Certified Development Corp.,
attributed the year-to-year decline partly to the state's struggling
economy, though lending volumes at her organization have picked up since
mid-January, she said.
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