By KLAS STOLPE
Sentinel Staff Writer
Financing opportunities for local businesses was the topic of Wednesday’s Sitka Chamber of Commerce luncheon, with a presentation by two speakers from Anchorage commercial loan companies.
Trevor Bradford, VP and senior loan officer of Evergreen Business Capital, and Theo Ransum, loan officer of a sister company, Evergreen Business Capital Community Finance, spoke of the low-cost loans available to businesses in rural towns like Sitka.
Speaking of their companies’ SBA Community Advantage Loan and Microloan programs, Ransum said:
“We fund businesses with less than three years of operation. We run low to moderate income areas and HUB (Historically Under-Utilized Business) zones, minority and veteran owned businesses. Our community advantage loan program can fund projects up to $250,000 and our microloan funds smaller projects up to $15,000.”
Ransum cited the Anchorage artisan ice-cream manufacturer Wild Scoops as a successful client.
“Their dream is to actually manufacture enough ice cream to fill Alaska’s hearts and tummies,” he said. “They are well on their way to doing that. We funded their initial commercial kitchen and the company has expanded so quickly they got into a brick and mortar and now are ready to move into a larger commercial kitchen.”
Trevor Bradford, left, and Theo Ransum of Evergreen Business Capital companies. (Sentinel Photo)
The loan companies also funded a pharmacy in Homer, an urgent care medical facility in the Mountain View neighborhood of Anchorage, which Ransum called the most diverse area in America, with numerous restaurants and two tour-guide businesses.
The purpose of a microloan is to purchase equipment, inventory, provide working capital and refinance business debt, Ransum said. The advantage loan assists in business acquisitions and commercial real estate purchases.
The Evergreen companies build on the federal Small Business Administration program for small businesses.
“The SBA loan program was specifically created for startup businesses,” Ransum said. “SBA realized that startup businesses were having difficulty in finding funding. We are kind of the building block for you for building your business credit.”
Ransum said Sitka’s seasonal retail operations are perfect examples of the type of clients who would benefit from Evergreen’s 5 percent fixed rate loan, with no fees and no money down. The program also covers boat lending.
Bradford said the program is designed to come into communities and develop them, assisting with new construction, and adding additional infrastructure and fixed equipment.
“In a rural community like we have in Sitka you have small business everywhere,” he said. “Those small businesses can grow with assistance by SBA and the types of programs we have... this is a great opportunity for growth for the City of Sitka. The opportunities are here, it is just going to take time for you guys to see that maybe you can use these tools to help.”
Bradford talked about Evergreen’s SBA 504 loan program, offering low down payment loans and the opportunity to purchase fixed assets such as commercial real estate, vessels, machinery and manufacturing equipment.
“Typical financing at a bank would be 75 percent and 25 percent down” for a $100,000 loan, Bradford said. “So borrowers are looking to have to come to the table with $25,000 cash up front.”
He said the 504 loan allows a bank to lend up to 50 percent of the project and Evergreen would lend 40 percent of the remainder.
“You would essentially have 90 percent of your transaction financed,” he said, “giving yourself more cash flow for other things that you need to do to get your business going. This also gives you a fixed interest rate for up to 25 years.”
Bradford said that was important because of the national trend of rising interest rates.
“Typically you can’t get that in a traditional terms on a business lending finance,” he said.
He stated that in qualifying for an SBA loan an entity must be asking for money for that entity, and it needs to benefit a community that does business in the United States. Fifty-one percent of the property/vessel/etc., must belong to the owner or entity and occupy 51-percent of that property.
Bradford said almost every Sitka deal would qualify as they are in a rural area.
“So you hit the qualification already,” he said. “Now we just have to fund the businesses and get them in and figure out what we can do.”
Bradford can be contacted at trevor.bradford@evergreen504.com or (907)-982-5045 and Ransum at two.Ransum@EBCCF.org or (907)-795-6504.
