Invest Atlanta, formerly known as the Atlanta Development Authority (ADA), is the City of Atlanta’s authoritative economic development agency. It is an economic development organization that is research based. Invest Atlanta is an extension of the city government that is regulated by nine member board of directors officiated by the mayor. The organization represents intown Atlanta, a population of 525,000 that is growing. The primary focal points for Invest Atlanta are residential, business and investment growth in the city of Atlanta.
How does Invest Atlanta assist small business owners?
Invest Atlanta provides access to capital lending via their loan funds and programs. Small business owners can apply for loans that will; improve their business districts, activate job creation, provide financial assistance for equipment purchases, construction and renovation of privately-owned commercial buildings. Additionally there are loan programs that provide financial and technical assistance to minority and women-owned businesses. The following loan funds are available to small business owners:
Business Improvement Loan Fund (BILF) Program
BILF is designed to support breathing new life into pre-selected business districts in the city of Atlanta. Additionally, BILF supports commercial and industrial development in other eligible areas.
Eligibility for BILF
Addition and/or improvements to:
- commercial, industrial and mixed-use property;
- purchase of equipment and fixtures, that are part of the real estate;
- energy conservation designed to encourage the efficient use of energy resources for commercial, industrial, or mixed-use facilities;
- acquisition of commercial, industrial and mixed-use properties; and
- inventory and office equipment in targeted Business Improvement Districts.
There are two forms of financial assistance available direct loans and loan participants. Direct loans are provided by the City to applicants with eligible projects that are not able to obtain market-rate loans. The maximum loan amount is $50,000, that is to be repaid on a monthly basis not to exceed seven years. The interest rate will be determined based on the projects cash flow. Loan funds not exceeding $10,000 can be used to purchase office equipment and inventory to eligible applicants.
Loan participants are utilized for larger loans (greater that $50,000). Loans can be made to small businesses to assist with meeting the requirements for a SBA loan. Loan repayments may not surpass that of the longest contributing lender (maximum of 25 years).
Opportunity Loan Fund
The Opportunity Loan Fund was created to encourage job creation in the city of Atlanta. Small and medium size businesses that create at least five new jobs in the city of Atlanta can qualify for “gap” financing with the assistance of the Opportunity Loan Fund. As per the Invest Atlanta website:
Invest Atlanta will provide loans of $100,000-$200,000 at an interest rate of one-half (1/2) of the current prime interest rate plus 2 percent (1/2 Prime + 2 percent) with a minimum rate of 4 percent.
Eligibility for Opportunity Loan Fund
- For profit businesses located in any commercial and industrial area of the city of Atlanta
- Start-up businesses must have a minimum of 20 percent equity
- At least five new jobs shall be created in the funded project within the first year of funding
- Special consideration will be awarded to small business owners in the six development priority areas that are assigned in the New Century Economic Development Plan for the city of Atlanta
Maturity dates for loans are three years for inventory and working capital, five years for fixed assets, seven years on leasehold improvements, and fifteen years for property acquistion. In general the Opportunity Loan Fund provides funds for 50 percent of overall costs with the other 50 percent coming from private resources.
The Phoenix Fund
The Phoenix Fund provides financial assistance to small and medium-sized businesses for the construction or renovation of privately-owned commercial buildings; equipment purchases needed to operate a business, and, in some cases, working capital. In efforts to create and retain employment for low/moderate income residents, Invest Atlanta provides below prime rate loans from $10,000 to $100,000 to eligible applicants.
Eligibility for The Phoenix Fund
- Most types of small businesses are eligible for the Phoenix Fund with the exception of nonprofit businesses or financial institutions or businesses engaged in the sale of the combination of alcohol and nude dancing.
- The project must create or retain one job for each $15,000 loaned, and 51 percent of jobs should be made available to low and moderate income persons.
The Phoenix Fund loan maturity dates range from three to seven years (fifteen years for real estate) interest rate of the loan is one-half of the current prime interest rate, and 2 percent (1/2 of Prime + 2), with a minimum rate of 4 percent.
SBA 504 Loan Program
Minority and women-owned businesses interested in expanding and/or relocating to the city of Atlanta can obtain funding from Invest Atlanta financial and technical assistance. As per the Invest Atlanta website:
The SBA-504 Loan Program offers businesses a unique source for 90% financing. Loans are available through certified development companies certified under the U.S. Small Business Administration 504 Certified Development Corporation Program.
Eligibility for SBA 504 Loan Program
- Most for-profit businesses with less than $6 million in net worth; less than $2 million after tax profits, or less than 500 employees
- Owners must occupy at least 51 percent of space
- Acquisition of fixed assets (i.e. land and buildings)
- New construction (67percent occupancy)
- Machinery and Equipment
Loans up to $1.5 million or 40 percent of the calculated project costs (up to $2 million if the company meets a public policy goal). 504 loans for “small manufacturers” may be extended up to $4 million.The term of the loan for the SBA 504 Loan program is ten or twenty years real estate or a combination of real estate and equipment/machinery. The interest rate is fixed for the term of the loan based on a ten year treasury note.
Small business owners in the city of Atlanta and/or those that are willing to relocate should look into Invest Atlanta’s funding opportunities that are available. The Invest Atlanta campaign was announced in January by Mayor Kasim Reed in efforts to modernize the city’s economic development agency.
“I have made economic development one of my Administration’s top priorities, and this change represents an effort to modernize our approach to economic growth,” stated Mayor Reed during his annual State of the City business breakfast . “We must get our economy moving again because our unemployment level is too high and families are hurting. Focusing on business creation, attraction, retention and expansion not only creates jobs but also brings in new tax revenues for the city.”
For more information visit the Invest Atlanta website www.investatlanta.com.
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