504 Financing Helps Storage Company Expand

504 Financing Helps Storage Company Expand

A-Z Self-Storage of Michiana recently purchased a 54,000 sq. ft. self-storage facility in Plymouth, Indiana. The facility is comprised of six different buildings and has 380 total units, 54 of which are climate-controlled. The location also includes 15 outdoor parking spaces and a large rental and retail office with an enclosed kiosk for 24/7 customer service and convenience.

The company was able to obtain SBA 504 financing for the $2.5 million purchase of the Plymouth location from Lake City Bank and the Business Development Corporation in South Bend, Indiana. Business Development Corp. works with a variety of local lenders to provide SBA 504 financing to small business owners throughout Indiana and parts of Lower Michigan. The SBA 504 program offers a number of great benefits to borrowers including long-term, low fixed-rate financing with minimal equity injection for the purchase of real estate and equipment, allowing small businesses to conserve much needed working capital.

A-Z started operations in late 2013 and now owns nine different self-storage and small warehouse facilities including locations in Elkhart, La Porte, Marshall, Porter and St. Joseph counties in Indiana and Van Buren County in Michigan. Managing partner and part owner, Roy Roelke, spoke about how the SBA 504 loan program has contributed to the company’s continued growth, “The BDC and the various SBA Programs we have qualified for and used as a financing mechanism along with our local banks have been a large part of our growth and success over the past three and half years. Not only as the managing partner of A-Z Self-Storages, but also as a commercial and industrial real estate senior broker for Newmark Grubb Cressy and Everett, I continually see firsthand the advantages of working with the BDC and the SBA 504 program they offer to help all types of business startups and small businesses grow by providing the needed capital that they are not always able to secure from other sources.”

A-Z chose Lake City Bank as its bank partner to work on financing for this project. “Lake City Bank is proud to partner with the Business Development Corporation and the SBA 504 programs on the A-Z projects,” said Patti McNarney, Vice President, Commercial Banking Officer, Lake City Bank. “The program is a win-win for all parties involved.” Lake City Bank, a $4.3 billion bank headquartered in Warsaw, Indiana, is the fourth largest bank headquartered in the state, and the largest bank 100% invested in Indiana. Lake City Bank operates 49 branch offices in northern and central Indiana.

Tedd Schaffer, Vice President and Senior Loan Officer with the BDC talked about the advantages to the communities in which the SBA 504 program serves, “Projects like this are critical in generating sustainable tax revenue, creating new jobs and attracting further economic development throughout the immediate and surrounding areas. These factors embody the overall mission of both, the BDC and SBA. We are very proud to be a part of this deal and look forward to continuing our efforts to serve our communities.”