Commercial Real Estate Financing Financing Not Just for Flashy City Businesses
Author: Valerie Mellema
Date posted: 09.24.23

Many entrepreneurs are located in major cities, but this case study doesn't start with their stories. Instead, a small family-owned farm supply store in a Midwestern town is at the heart of this tale. After generations of hard work keeping the store afloat and making sure the community had what they needed to make a living, things changed

A New Need for the Community

The owners of the farm supply store noticed a problem when the nearby garden store shut down because its owners retired. They saw that there was a gap in the market that needed to be filled. Since there was already a link between farming and gardening, the farm supply owners decided to come together and discuss whether they should step in to meet the demand.

 

One of the most significant issues brought up at the meeting was how much expansion would be needed. The shop would either need to become larger or new property would be necessary to ensure the locals had a place to pick up seeds, plants, containers, garden tools, and more.

Commercial Real Estate Financing

Making the Decision to Expand

After having several meetings, everyone in the farm supply shop agreed to buy a larger building. They knew it was necessary to accommodate the upcoming increase in customers. The only thing left to do was to figure out how much money they needed and where they could get it from.

 

In the end, it was decided that the project could go forward with $600,000 – $400,000 to purchase the new building and $200,000 for inventory and upgrades. However, being a family-owned business, there was no way they would let that expense come out of anyone’s pocket. So, they actively started exploring other options to find a solution.

 

Commercial Real Estate Financing Paves the Way

After considering all the options, the small-town farming shop, soon to be a spot for all the gardeners in the area, opted to go with a commercial real estate loan. Compared to other financing options, it simply made the most sense.

 

Reasons to Choose Commercial Real Estate Financing

The store opted for a commercial real estate loan primarily because of its excellent terms. Moreover, they could utilize the new property as collateral, ensuring a long-term loan with manageable fixed payments.

 

Happy Endings All-Around

Things turned out wonderfully. The supply store had already become a vital part of the area. Customers eagerly sought their gardening necessities from them. Presently, the owners are happily making loan payments. They are actively envisioning the future and exploring additional beneficial changes for their small community.

Financing Not Just for Flashy City Businesses
About The Author | Valerie Mellema

Valerie has over 16 years of experience as a professional writer of blogs, eBooks, articles and press releases, with a focus on finance and alternative lending. Valerie resides with her family in Texas and is passionate about her horses.

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