Access Florida Finance Corporation
FFN Member Organizations • Access Florida Finance Corporation (AFFC) – Loans & loan guarantees for rural & minority businesses • Florida Development Finance Corporation (FDFC) – Florida Enterprise Bond: $250, 000 to $2 million tax-free industrial revenue bonds • Florida Export Finance Corporation (FEFC) – Pre-export working capital guarantees – Political risk insurance – Medium-term financing for export of capital goods – OPIC guarantees for investment outside of U. S. • Florida First Capital Finance Corporation (FFCFC) – 504 Loan Program: Loans for small business real estate & equipment – Florida Recycling Loan Program: Loans to support recycling & reduced landfill use – FLEX Loan Program: Loans for profit & nonprofit real estate & equipment, includes refinance • Neighborhood Lending Partners, Inc. (NLP) – Provides financing to developers of affordable housing and community revitalization
FFN Summary • Unites Florida’s small business economic development finance programs • Lends and guarantees loans to Florida small businesses • Builds awareness of private and public sector economic development finance resources available to Florida small businesses FFN 1 -YEAR TOTALS TOTAL PROJECTS ………………… 442 TOTAL PROJECT DOLLARS …………. $824, 849, 804
FFN Assures Credit Availability Fed Data: ll Businesses Face Sma Credit Crunch • Access to capital at reasonable rates and terms • Assures credit availability in uncertain economic times Commercial Lend ers Credit Box Shrink ing • Unique partnership allows private lenders greater credit flexibility Crunch Time: Credit Woes Threaten Economy • Strengthens local economic development efforts through direct financial stimulus
Access Florida Finance Corporation
Mission Statement To provide Access To Capital and technical assistance to black, rural and small businesses throughout Florida and the nation. AFFC will foster Economic Development and job creation by use of Federal, State and private Community Based Programs and in coordination with our strategic alliances.
Eligible Projects • • • Commercial real estate acquisition, improvements or construction Machinery & equipment acquisition Community Development Projects Create or save jobs Franchise acquisition Existing business acquisition, expansion or merger Pollution control Transportation Services Working capital New business start-up (must prove relevant industry experience) Special purposes within the scope of AFFC’s mission
General Requirements • Commercial business • Agree to provide all necessary information • Pay $250 application fee • Sound individual character • Minimally acceptable credit score of 600 • Acceptable form of Collateral (i. e. Real Estate, business assets, etc. . ), with one notable exception • Cash flow of business reasonably supports loan payments
Black Business Loan Program • Located in Florida • Business at least 51% owned and controlled by Black Floridians • U. S. Citizen and Florida Resident • Direct Loans up to $50, 000; Loan Guarantees up to ability to borrow from a bank • Unsecured Micro Loan up to $10, 000 available for owners with a 625+ credit score • Interest rates on Direct Loans currently range between 5% and 10%, depending upon circumstances; Loan Guarantees are at bank rates Loan is economically sound and will assist the business in becoming bankable, increase employment and grow the economy Business will be able to compete successfully with the Loan or will obtain technical or managerial support • •
Rural Business Loan Program • Must be citizens of the United States. In the case of an organization, at least 51 percent of the ownership must be U. S. citizens. • Must be located in a rural area in Calhoun, Gadsden, Gulf, Holmes, Jackson or Washington County • Direct loans from $10, 000 to $150, 000 • Interest rates currently range between 6% and 10%, depending upon circumstances • Must be unable to finance the proposed project with other means • No delinquent debt to the Federal Government. USDA Loan Funds may not be used to satisfy the delinquency.
How Businesses Get Financed • Inc. Magazine 5000 fastest growing companies – 71% were financed by owner or family and friends – 24% Debt financed – 5% Equity financed • Entrepreneur Magazine’s Hot 500 Companies for 2007 – 64% were financed by owner or family and friends – 25% Debt financed – 11% Equity financed
Clearinghouse Referrals Private Finance Cos Banks FFN SBDC Applicant Direct Access To Capital Clearinghouse (AFFC) Accion FSHCC FBCC BBICs HBIF
Success Story Sebai CMET, Inc. • Located in Melbourne, FL • Environmental Clean Energy Company • Requested $20, 000 in a working capital Line of Credit to fund operations while a larger loan from Space Florida was in the works. • Closed in February 2011
Success Story The Chestnut Firm • Located in Gainesville, FL • Law firm specializing in tobacco related cases • Requested $50, 000 for equipment purchases and working capital to fund expanding operations • Closed in November 2008
Success Story Jus Hip Hop • Located in Pembroke Pines, FL • Dance Studio • Requested $30, 000 in working capital for Start-up financing • After one year, Jus Hip Hop had eight employees and 74 students • Closed in July 2009
Success Story Naturally “U” Art and Braid Studio • Located in Tallahassee, FL • Hair Care and Educational Services • Requested $13, 000 in financing to move to larger location and begin classroom services • First place winner of First Annual Business Plan Writing Contest in 2009 • Closed in May 2010
Contact Information Mark A. Scovera President 2623 Blairstone Road Tallahassee, FL 32301 850 -878 -0775 850 -270 -1122 (fax) Mark. Scovera@Access. Florida. Finance. com http: //www. Access. Florida. Finance. com
Florida Development Finance Corporation
Florida Development Finance Corporation • Enterprise Florida affiliate • Administers Florida Enterprise Bond program • Typical minimum/maximum amounts for tax exempt financing: $800, 000 -$20 million • No maximum for taxable financing but should exceed $1 million because of transaction costs associated with the bonds
Florida Development Finance Corporation • Must be used for capital expenditures, e. g. land acquisition, construction, equipment • Use of bonds – 501 (c) (3)s, small manufacturers, sewage facilities, airports, multi-family housing • Smaller bond projects can be pooled to “minimize” transaction costs
Success Story • Royal Concrete, Okeechobee County • Modular concrete building manufacturer • Located in Enterprise Zone & Rural Area of Critical Concern • FEDF issued $18 million in taxable bonds • Proceeds financed acquisition/construction of real property and equipment purchase • Plant opened 1/31/08 - 600 jobs in 3 years
Success Story • Learning Gate Community School, Hillsborough County • Not-for-profit 501(c) (3) charter school for 550 students • Project funded by taxable and tax-exempt bond financing, including $6. 5 million+ in tax exempt financing • Proceeds used for construction and equipping new classrooms
Florida Export Finance Corporation
FLORIDA EXPORT FINANCE CORPORATION A Not-For-Profit Corporation Formed and Funded By Florida Statute 288. 770
FLORIDA EXPORT FINANCE CORPORATION Mission: Creation of Income and Employment for Florida Residents
FLORIDA EXPORT FINANCE CORPORATION Achieved By: Providing Financial Guarantees and Consultative Services to Exporters Mandating Shipments thru Florida Ports
FLORIDA EXPORT FINANCE CORPORATION Products: Pre-Export Working Capital Short-Term Credit and Political Risk Insurance Medium-Term Financing Structures for Capital Goods
FLORIDA EXPORT FINANCE CORPORATION Eligibility: Florida Registered Company Majority Owned by Florida Resident(s) Manufacturing or Trading Co. Less than 250 Employees Net Worth < $6, 000 No Mandate on Time in Business
FLORIDA EXPORT FINANCE CORPORATION Financial Support: Exporter Must Have Orders or Series of Orders from Foreign Buyer(s) Loan is made to Support the Order(s)
FLORIDA EXPORT FINANCE CORPORATION Maximum Guarantee: $500, 000 Revolving Line of Credit or Single Sale Flexible Tenor
FLORIDA EXPORT FINANCE CORPORATION Exporters Responsibility: Sign FEFC Application Sign Loan Documentation with Lender Personal Guarantees Required for Shareholder(s) of 20% or More
FLORIDA EXPORT FINANCE CORPORATION Pre-Export Takeouts: Assignment of Proceeds of CILC’s Post-Shipment Credit & Political Risk Insurance Case by Case Approval by FEFC for 5 A Rated Foreign Buyers
FLORIDA EXPORT FINANCE CORPORATION Transaction Guidelines: The Loan Amount Will not Exceed the Cost of Goods Sold in the Transaction The FEFC Guarantees up to 90% of the Loan Amount
FLORIDA EXPORT FINANCE CORPORATION Transaction: $100, 000 Letter of Credit 80, 000 Cost of Goods Sold Loan: $ 80, 000 Loan Amount (100%) 72, 000 FEFC Guarantee (90%) 8, 000 Lender’s Share (10%)
FLORIDA EXPORT FINANCE CORPORATION Lender Receives a Transaction Attachment and Guarantee Commercial Bank Lenders Utilize Normal Commercial Documentation for FEFC Guaranteed Loans
FLORIDA EXPORT FINANCE CORPORATION FEFC Works with Ninety Six Commercial Bank Lenders Across the State of Florida for Pre-Export Guarantees
FLORIDA EXPORT FINANCE CORPORATION Market Access Enterprise Florida International trade & Business development Boca Raton Jacksonville Miami Orlando Pensacola Tallahassee Tampa (561) 362 -5626 (904) 359 -6600 (305) 569 -2650 (407) 902 -0230 (850) 474 -2521 (850) 922 -8832 (813) 276 -9430
Florida First Capital Finance Corporation
About FFCFC • Florida First Capital Finance Corporation is a statewide certified development company that is licensed and regulated by the U. S. Small Business Administration • FFCFC was founded by the state of Florida in 1983, and today operates as a private, nonprofit corporation • FFCFC provides access to capital for small business owners in order to stimulate and develop small business growth in Florida • FFCFC is a charter member of the Florida Finance Network, an alliance of economic development agencies
FFCFC’s Purpose • Strengthen the economic development of the state of Florida and provide financial assistance to small businesses, specifically through the 504 loan program, in conjunction with the SBA and private sector lenders • Provide technical assistance: Structuring, underwriting, closing • Sole source of contact between the borrower and the SBA • Service the loan for its life
Why Own? • Pay yourself • Build equity/grow an asset • Reduce real estate expenses • Control/fix real estate expenses • Stop throwing money away on rent! • Fulfill a dream • Own your real estate even after you sell your business (became a landlord yourself)
Use of 504 Proceeds • Acquisition of vacant land for construction of a new building • Construction of a new building • Acquisition of land existing building • Remodel, convert, expand or renovate existing building • Leasehold improvements • Acquisition of machinery and equipment with a minimum useful life of 10 years • Purchase of furniture, fixtures and equipment • Contingency reserve, not to exceed 10% of the construction costs • Associated fees, including fees to the SBA, and soft costs
504 Program Benefits • Up to 90% commercial financing • Projects from $125, 000 to $20 million • Below market, true fixed interest rates – No ARMs • Low down payment, usually 10% • Long amortization terms, up to 20 years • Loans may be assumable by qualified, acquiring businesses • Associated fees, including fees to the SBA, and other up-front costs and expenses may be financed in the loan
504 Eligibility • The borrower must be a legal entity: corporation, partnership, sole proprietor, limited liability company • The borrower must be a for-profit business located in or planning to locate in Florida • The borrower must be a U. S. citizen or registered alien with a green card • The borrower’s tangible net worth cannot exceed $8. 5 million • The borrower’s two-year average after tax annual profits cannot exceed $3 million • The project cannot be entirely income producing (i. e. , relying on tenant income)
50/40/10 Deal Structure Sample Project: Cost Acquisition of Building Renovations Soft Costs Total $850, 000 $100, 000 $50, 000 $1 million Financing Lender – 1 st Mortgage (50%) FFCFC 504 – 2 nd Mortgage (40%*) Borrower Equity (10%) Total $500, 000 $400, 000 $1 million (* Up to $1. 5 million standard; $2 million public policy; and $4 million manufacturing)
The FFCFC Advantage l Quick turnaround time l Streamlined environmental process l Lowest effective rates permitted by law l Approval decisions made daily l l Simultaneous closing process for straight acquisition projects Specialized statewide network of local FFCFC closing attorneys
Success Stories Borrower: Oxley Cabinet Warehouse, Jacksonville, FL Industry: Reseller of building materials Loan Type: 504 Financing Purpose: Purchase land existing 16, 900 square-foot building Loan Amount: $616, 600 Borrower: Pegasus Transportation, Orlando, FL Industry: Charter bus transportation Loan Type: 504 Financing Purpose: Purchase land existing 6, 440 square-foot building Loan Amount: $810, 000 Borrower: CDS Manufacturing Co. , Quincy, FL Industry: Small manufacturer Loan Type: Florida Recycling Loan Program Financing Purpose: Purchase molds forming pre-cast concrete products using reclaimed concrete Loan Amount: $200, 000
Neighborhood Lending Partners, Inc.
Core Purpose Statement Improving quality of life in our neighborhoods by facilitating private and public investment, to provide opportunities for growth preservation and revitalization.
Neighborhood Lending Partners • Established in 1993 • Community Development Financial Institution • Directs Three Non-Profit Operating Entities • Banking Consortium • Non-Bank Partners • Current Internal Funding Capacity of $345, 000 • Assists Local Governments as defined by the U. S. Department of the Treasury (http: //www. cdfifund. gov) (NLPWF, NLPSF, NLPNF) (87 Financial Institutions; $347 million closed loans) (10 SHIP providers, CDFI, Fannie Mae, Community Development Trust, Community Reinvestment Fund, Federal Home Loan Bank, Shell Oil Company)
Neighborhood Lending Partners Statewide Member Loan Pools – 04/15/2008 NLPNF $49, 900, 000 NLPWF $138, 250, 000 Total Member: $274, 150, 000 Overall Total: $345, 000 (Loan Pool totals include active and non-active Member commitments) NLPSF $86, 000
Neighborhood Lending Partners Debra S. Reyes, CEO 3615 West Spruce Street Tampa, Florida 33607 Phone: (813) 879 -4525 Fax: (813) 873 -9767 NLPWF Kevin L. Tatreau, President 3615 West Spruce Street Tampa, Florida 33607 Phone: (813) 879 -4525 Fax: (813) 873 -9767 NLPSF Cecilia La Villa-Travieso, President 1500 San Remo Ave, Suite 140 Coral Gables, Florida 33146 Phone: (305) 666 -6153 Fax: (305) 666 -7996 NLPNF Doug Brown, President 760 Riverside Ave, Suite 255 Jacksonville, Florida 32204 Phone: (904) 350 -1999 Fax: (904) 350 -1998
Neighborhood Lending Partners 87 Active Bank Members - 04/15/08 Sun. Trust Bank Colonial Bank, NA M&I Bank Regions Bank $ $ Fifth Third Bank Raymond James Bank BB&T Bank. United, FSB Iron. Stone Bank Synovus Bank Ocean Bank Mercantile Bank Riverside National Bank Great Florida Bank Capital City Bank Ever. Bank of Florida Bank of Tampa Washington Mutual Bank. Atlantic Mercantil Commerce. Bank Atlantic Coast Federal Bank First Guaranty Bank and Trust Prosperity Bank City National Bank Coast Bank of Florida Helm Bank HSBC Bank Mellon Bank Pacific National Bank 24, 250, 000 16, 910, 000 15, 750, 000 12, 565, 000 Harris Bank RBC Centura Bank Banco Popular North America Coconut Grove Bank $ $ 2, 625, 000 2, 585, 000 2, 000, 000 Metro. Bank of Dade County Optimum Bank Republic Federal Bank Sun American Bank $ $ 1, 000, 000 $ 10, 750, 000 $ 10, 000 $ 8, 500, 000 $ 8, 000 $ 7, 057, 500 $ 6, 900, 000 $ 6, 000 $ 5, 250, 000 $ 5, 000 $ 4, 750, 000 $ 4, 500, 000 Continental Nat. Bank of Miami Intervest National Bank R-G Crown Bank Total. Bank Superior Bank of Florida CNL Bank Eastern National Bank First Southern Bank First. Bank Florida Intercredit Bank, N. A. Trans. Atlantic Bank of Commerce $ $ $ $ 2, 000, 000 1, 502, 500 1, 500, 000 1, 500, 000 1, 370, 000 Bank of St. Petersburg Bay Financial Savings Bank Park Avenue Bank First Community Bank of Am. Northern Trust Bank of Florida Center. State Bank West Florida Bank of Florida - Tampa Bay BBU Bank Central Bank Encore Bank Eurobank Florida Capital Bank of Tampa Florida Traditions Bank $ $ $ $ 850, 000 750, 000 725, 000 600, 000 565, 000 500, 000 500, 000 $ $ $ Bay Cities Bank American Enterprise Bank BAC Florida Bank of Florida - SW Florida Bank of North Florida Citizens First Bank Eagle National Bank of Miami First Citrus Bank First Commercial Bank of TB First Gulf Bank First Nat. Bank of So. Miami Flagship Community Bank $ $ $ 1, 250, 000 1, 000, 000 1, 000, 000 1, 000, 000 1, 000 Heritage Bank of Florida Plus International Bank Regent Bank Union Credit Bank Pilot Bank Old Harbor Bank Cornerstone Community Bank Enterprise Nat'l Bank of PB First Home Bank Franklin Templeton B&T, FSB Southern Commerce Bank Whitney Bank $ $ $ 500, 000 395, 000 370, 000 250, 000 250, 000 4, 500, 000 4, 380, 000 4, 000 3, 500, 000 3, 000, 000 3, 000, 000
Neighborhood Lending Partners Loan Products Land Assembly Loans for future affordable housing developments financed by NLP Real Estate based Economic Development Loans – Traditional and SBA 504 Supported Multifamily Construction Loans Lot Acquisition & Development Loans for the delivery of For. Sale Residential Lots/Pads Multifamily Acquisition/ Rehabilitation Loans Multifamily Permanent Loans Housing Preservation Loans for Project-Based HUD Section 8 Properties (Multifamily rental) Construction Loans for the delivery of For-Sale Residential Homes (detached, townhomes, condos) Condominium Conversion Loans Aging-Out Foster Care Loans to assist Foster Care Individuals as they age-out of the program (in development with private equity funds)
Neighborhood Lending Partners Closed Loan Distribution (as of March 2008) Geographic Distribution County # of Projects Geographic Distribution # of Units Loan Volume County # of Projects # of Units Loan Volume Brevard 1 50 $1, 500, 000 Manatee 3 348 $9, 113, 000 Broward 4 18 $4, 310, 000 Marion 1 144 $3, 000 Citrus 1 50 $1, 700, 000 Miami-Date 22 1, 415 $97, 384, 889 Desoto 6 278 $9, 735, 706 Monroe 1 102 $5, 381, 000 Duval 2 53 $1, 102, 540 Orange 1 168 $3, 205, 264 Escambia 1 112 $6, 150, 000 Pasco 5 491 $17, 258, 939 Gadsden 2 220 $12, 800, 000 Pinellas 16 359 $16, 042, 801 Hardee 2 224 $4, 015, 000 Polk 9 1, 153 $26, 845, 526 Hendry 3 209 $1, 731, 284 Putnam 1 78 $1, 030, 000 Hernando 1 128 $5, 850, 000 Sarasota 4 456 $4, 200, 000 Highlands 4 382 $9, 626, 000 St. Johns 2 112 $2, 195, 000 Hillsborough 37 4, 242 $84, 313, 042 Sumter 2 72 $1, 853, 000 Indian River 2 240 $8, 996, 639 Volusia 1 80 $3, 147, 212 Lee 2 50 $1, 514, 000 Madison 1 72 $3, 609, 845 137 11, 306 $347, 610, 686 28 Counties
Neighborhood Lending Partners Closed Loan Distribution (as of March 2008) Housing by Occupancy Type of Unit Number of Units Percent Senior Citizen Housing 1, 846 16. 3% Farm Worker Housing 934 8. 3% Special Needs Housing 108 1. 0% Large Family Housing 273 2. 4% Family Housing 8, 145 72. 0% Totals 11, 306 100. 0%
Neighborhood Lending Partners Closed Loan Distribution (as of March 2008) Income Restrictions Maximum AMI Number of Units Percent 35% 744 6. 6% 40% 254 2. 2% 50% 894 7. 9% 60% 7, 042 62. 3% 80% 741 6. 6% 120% 31 0. 3% Market 1, 600 14. 2% Totals 11, 306 100. 0%
Tangerine Plaza Project Description 47, 385 Total square feet of retail space on 3. 6 acres 39, 079 SF for anchor tenant (grocery store) 8, 306 SF for local tenants, including police resource center with no rent Location 22 nd Street & 18 th Avenue South St. Petersburg (Midtown) Pinellas County Midtown Demographics Average Income was 47% of AMI 33% of population was below poverty level No grocery store or bank in neighborhood Site Issues 32 separate parcels, some with multiple owners Needed eminent domain rights to clear title on one parcel City to provide land lease, but required a shopping center to operate on-site Anchor Tenant Requirements Needed a $1, 000 interest free loan to help pay for tenant improvements with a term of 20 years, to begin repayment after the 10 th year Rental rate was one-third the market rate for a grocery store
Tangerine Plaza Final Project Costs Land Lease (prepaid in full) $ 495 Site Development $ 750, 270 Building Shell/Local TI $ 4, 498, 758 Anchor Tenant Improvements $ 1, 000 Permits & Government Fees $ 39, 466 Professional Fees $ 377, 310 Pre-Development Soft Costs $ 133, 000 Construction Financing Costs $ 209, 301 Insurance $ 26, 353 Developer Overhead $ 133, 354 Working Capital $ 504, 859 Developer Profit $ 429, 943 Community Outreach Program $ 200, 000 Tenant Assistance – Rent/Build-Out/WC $ 500, 000 NMTC Financing Costs $ 264, 003 NMTC Organization & Placement Fees $ 456, 609 CDE/Investment Fund Escrows $ 12, 540 TOTAL` $ 9, 536, 361 (Excludes Land Costs in excess of $1, 000 incurred by the City) Appraised Values Market with Favorable Financing $ $ 4, 220, 000 5, 320, 000
Tangerine Plaza Final Project Sources of Financing BB&T EDGE Loan (FHLB-Atlanta) City of St. Petersburg NLPWF CDFI Funds OCS Grant Anchor Tenant City of St. Petersburg Private Donation NMTC Equity Total Sources $ 3, 200, 000 (Paid off NLPWF Construction Loan) $ 1, 336, 500 $ 661, 500 $ 700, 000 $ 769, 212 $ 75, 000 $ 10, 000 $ 2, 784, 149 $ 9, 536, 361 (Excludes Land donated by the City in excess of $1, 000)
Sonrise Villas, Phase I Project Description 160 rental apartment units on 16. 0 acres 16 two bedroom / two bath units (899 SF) 88 three bedroom / two bath units (1, 049 SF) 56 four bedroom / two bath units (1, 199 SF) Location 53 N. Willow Street Fellsmere, Indian River County Project Restrictions 12. 5% of the units (20) at 40% of AMI (restricted rents will be 53% of market rate rents) 87. 5% of the units (140) at 50% of AMI (restricted rents will be 70% of market rate rents) 40% of the units are farmworker / commercial fishworker 60% of the units are family
Sonrise Villas, Phase I Development Issues Fellsmere is a rural town with an economy based on agriculture. It was difficult to find rental housing and many reportedly resort to substandard housing or multiple families renting one unit. Many farmworkers rent from their employers, most are not legal residents; however, 47% of the farmworkers do not rent from their employer. Family income for the subject project will range from $14, 160 - $30, 400 (in 2003). Although there are no apartments in Fellsmere, there is another farmworker rental complex of 71 units planned in town to be financed by Rural Development (HUD Section 514/516 developments). These units will be available to a lower income population and will have a broader definition for “farmworker. ” There is an estimated 229 legal farmworker households in Indian River County and a supply of farmworker housing (including those that are proposed) totaling 335 units. The appraisal included the phrase “ … development of the subject should proceed with caution. ”
Sonrise Villas, Phase I Final Project Costs Land Site Development Hard Construction Costs Permits & Government Fees Professional Fees Financing Costs Insurance Developer Overhead & Profit Other Soft Costs TOTAL $ $ $ $ $ 400, 000 695, 584 8, 569, 161 818, 514 366, 250 1, 292, 832 102, 200 1, 452, 149 351, 520 14, 552, 245 Appraised Values Market Restricted Rents w/ Favorable Financing $ $ $ 8, 175, 000 4, 435, 000 4, 745, 000 Final Project Sources of Financing NLPWF 1 st Mortgage FHFC SAIL Loan FHLB AHP Loan LIHTC Equity Deferred Developer’s Fee Total Sources $ $ $ 3, 500, 000 1, 500, 000 8, 744, 292 307, 953 14, 552, 245
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