Benefits of a 504 Small Business Real Estate Loan

504 Loans are a strong fit for purchasing or constructing a commercial owner-occupied facility, thanks to:

  • Lower equity through the standard 50-40-10 split that preserves working capital.
  • Fixed-rate SBA 504 debenture options at 10, 20, or 25 years for predictable payments.
  • Eligible project costs can include land, site work, construction, build-out, renovations, and approved soft costs.
  • A coordinated path from structure through servicing with one point of contact at 504 Capital.
Loan Calculator
Business professionals sealing an SBA 504 loan agreement with a handshake

Eligible Uses of Proceeds

SBA 504 funds fixed assets tied to operations. Real estate projects typically include these costs.

  • Purchase or build an owner-occupied facility and expand an existing location when needed.
  • Land acquisition with related site improvements and eligible soft costs as part of a defined project.
  • Renovation, build-out, or major improvements that support operations.
  • Refinance qualified debt used initially for real estate when program rules are met.
Business team discussing SBA 504 loan financing options in a meeting

How to Purchase Land with an SBA 504 Loan & Requirements

Land can be financed when it supports an owner-occupied real estate project with a clear plan and timeline. Standard owner-occupancy thresholds apply based on project type. Third-party reports are ordered early so the file moves on schedule.

  • Business type: for-profit U.S. small business that meets SBA size standards.
  • Fixed SBA 504 debenture options at 10, 20, or 25 years for predictable payments.
  • Eligible project costs can include land, site work, construction, build-out, renovations, and approved soft costs.
  • A coordinated path from structure through servicing with one point of contact at 504 Capital.
Aerial view of land and property map for SBA 504 real estate financing

Why Work With 504 Capital Corporation for SBA 504 Real Estate Loans

Daily SBA 504 work, lender coordination, and in-house servicing keep the file on track from first call through funding. The team packages efficiently, aligns with your lending partner, and stays engaged after closing, ensuring that payments, escrow items, and routine requests are handled in one place. For you, that means stable payments, more cash kept within the business, and a clear path to closing.

Call Now Check Eligibility

SBA 504 Real Estate Loan FAQs

Most owner-occupied real estate projects follow the 50-40-10 structure: ~50% first-lien from the bank, ~40% SBA 504 debenture, and ~10% borrower equity. Startups or single-purpose/special-use properties may require more equity per SBA policy and credit review. Your 504 Capital contact will flag those early and align structure with your lending partner.

Yes. Eligible uses include ground-up builds, additions, renovations, interior build-outs, and approved site work and soft costs—provided the property will be primarily used by the operating company and the scope/timeline are defined.

SBA 504 funds owner-occupied space. For new construction, the operating company generally occupies at least 60% at completion (with a path to 80%); for existing buildings, occupancy is typically 51% or more. We confirm thresholds at scoping so the file stays policy-aligned.