Can You Build Golf Courses with an SBA 504 Loan?
Golf, as we know it today, originated in Scotland more than 500 years ago. Today, the sport offers everything from a fun afternoon on the links to hardcore challenges that pit professional players against one another. However, in order to function, the sport needs golf courses, which also happen to be a profitable business. In the last three years, the golf course industry has grown by 1.2% and is expected to generate a whopping $24 billion in revenue in 2018. All this means that it’s a great time for golf course owners to expand their businesses, and an SBA 504 loan could be a fantastic way to do so.
Uses and Limitations of SBA 504 Loans for Golf Courses
If you already own a golf course, and want to make it larger or better, you can do so with an SBA 504 loan. A 504 loan can give you the funds necessary to purchase additional real estate, and then make necessary improvements. You gain access to up to $5 million in funding that can be used to create the manicured, professionally-designed golf course you demand, as well as investing in equipment like golf carts, ball washers, clubhouse equipment, and more. In addition, if you already own a country club, and want to add a golf course, an SBA 504 loan may be able to help you as well. However, you should check with a lender to make sure that this use will be fully approved by the SBA.
An SBA 504 loan can also be a great option if you want to purchase an existing course that has closed down and breathe new life into it, particularly if you want to make efficiency improvements that benefit the environment. In fact, if you can reduce your course’s energy use by 10%, or figure out a way to get at least 10% of your energy from alternative sources, you may be able to qualify for the SBA 504 green program. This program permits borrowers to take out a larger $5.5 million loan for each project they are involved in, with an overall loan limit of $16..5 million.
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