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Mercantile Capital Corporation
Your SBA 504 Loan Experts
Your SBA 504 Loan Experts

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SBA Loans and Mobilgeddon

If you’re interested at all in web traffic and search engine optimization (SEO) — and you should be, at least a little — you heard a thing or two about “mobilegeddon” in the weeks leading up to last Tuesday. That’s the day when Google rolled out a change to its search algorithm that favors mobile-friendly sites. When we first read about the change, to be totally transparent, we panicked a little bit. Neither nor was designed with mobile in mind, and we worried that our web search traffic would take a hit. After reading more about Google’s change and reviewing our traffic data, we calmed down and got less scared and we think you should do the same. Here’s why…

Only mobile search will be affected.

We all use our mobile devices to search and surf the web more than ever before. Our phones have become supercomputers that rarely function as actual phones. Google simply wants to make it easier to find content that is formatted for our mobile devices when we’re using our mobile devices. You can read more from Google here. We’ve spent time and effort to make our website SEO-friendly so that we show up when people are searching for SBA 504 loans, or commercial real estate financing, or any number of things that might indicate they’re looking for the service we provide. We were terrified that we were going to lose all that work simply because our site wasn’t optimized for mobile the way Google wanted it to be, but that’s not the case. The change Google is making only affects searches made from mobile devices, so desktop search results will remain unaffected.

Mobile traffic may not be significant traffic.

Again, we all use our devices much more frequently these days, but there may not be a lot mobile searching being done for you particular product or service. According to a Google/Nielsen study, about 4% of all mobile searches are for financial information, and that’s a really broad category. When it comes to commercial mortgages and SBA 504 loans in particular, it’s more likely that people are searching from their desktop computer. We looked at our metrics, and about 13% of traffic to is from mobile devices. That’s not nothing, but we decided it’s not enough to warrant a rush redesign of our entire site. If you don’t already track where your traffic is coming from and what users are doing on your site, you ought to get started with Google Analytics. You might learn some interesting things about how people interact with your website and how you can improve it.

But don’t think mobile doesn’t matter.

Just because Google’s new mobile-friendly search algorithm might not hurt your non-mobile SEO…and just because you don’t get gobs of mobile traffic to your website…that doesn’t mean that you can ignore the trend toward mobile technology and use. You might be in the same boat as us — our current site was built in early 2011 and it wasn’t built with mobile browsing in mind. Rightly or wrongly, we decided that our mobile traffic wasn’t substantial enough to invest in making our sites responsive back then. Even our email metrics at the time told us that most people were reading emails on their desktop computers rather than their mobile devices. But four years is a long time in the internet/technology world, and we’re getting to the point where we need to make some changes, not the least of which is becoming mobile-friendly. That said, we weren’t prepared to scramble and pay a small fortune to meet Google’s new mobile standards by April 21st.

Mobile-friendly may be easier than you think.

If your site is built on WordPress, chances are you’re already mobile-friendly. Or you likely have the option of getting to mobile-friendliness by choosing a new responsive template. Our site runs on WordPress, but it was custom-coded so it’s not as simple as selecting a new template for us. However, Google recommends several resources that work pretty seamlessly to convert existing content to a mobile-friendly format: Jetpack, WPTouch, and WP Mobile Detector. Of the three, we chose WPTouch and found that it was pretty easy to set up. There’s a free version (which is pretty robust) and a paid version with additional themes and options. So far it seems to be a pretty nice solution if you’re looking for a quick fix like we were. We’ll be exploring the paid option and will report our findings soon. Our blog ( is currently mobile-friendly thanks to WPTouch, and we’ll be installing the plugin on soon (it’s a larger and more complex site, and we think it will require a little more attention to get set up properly).

Mobilegeddon and you…

So, should you panic about mobilegeddon? No. Should you consider making your website(s) mobile-friendly anyway? Yes. Can you do that without investing a bunch of money to redesign your site right this minute? Yep. If you’re at all curious about WPTouch and how it works, we’ll be glad to share what we’ve learned. Post any questions in the comments below or email our Marketing Director Trey at and he’ll get back to you right away. We’re by no means experts at this, but we might know just enough to be helpful.

Thanks for reading, and please share this with anyone you know who’s still worried about mobilegeddon. Friends don’t let friends panic needlessly about SEO…

– Your 504 Experts

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$2 Billion or Bust: Q1 2015 Update

The first quarter of 2015 was perhaps the busiest three months in the history of Mercantile. We closed seven loans worth more than $7.55 million in total project costs in five states, which isn’t record-breaking for us by any stretch, but we also completed our merger with IBERIABANK and that added quite a bit to the everyday goings on here at Mercantile headquarters. Here are some the 504 projects we’ve closed so far this year:

– Not far from our headquarters here in Orlando, Florida, we financed the purchase and renovation of a medical facility for Orlando Epilepsy Center, Inc. The total project cost was $1.97 million and we funded the temporary 1st mortgage (during the construction phase) as well as the interim 2nd mortgage.

– We provided an equipment loan for a Planet Fitness in Crawfordsville, Indiana. This is in addition to the acquisition/renovation financing we did for the same entrepreneur in December 2014.

– We helped Northern Bay Contractors, Inc. purchase a 6,186 square foot office building in Long Island City, New York. The total project cost was $1.9 million and we funded both the 1st and 2nd mortgages for this 504 project.

– We provided 504 financing for the acquisition of a brewpub just outside Ann Arbor, Michigan.

– A day care center in New Boston, New Hampshire purchased land and an existing building with our help. This $750,000 project required only 10% down from our client.

– We provided a 504 loan that covered the build-out and equipment for a Chicken Salad Chick franchise in Tallahassee, Florida. With a total project cost of $335,000 (85% loan-to-cost), this loan is on the small side for us, but it proves that SBA 504 projects come in all shapes and sizes. (Chicken Salad Chick makes a mean chicken salad, by the way.)

And when the dust settled, we were part of a different, bigger bank. The fact that IBERIABANK now owns us won’t be all that apparent from your perspective, other than that our pool of resources to fund SBA 504 loans is significantly larger. We’re still Mercantile, still a small and lightweight and entrepreneurial operation, just with a bigger backer. If you have any questions about this whatsoever, don’t hesitate to call or email. And Ken still answers the phone (most of the time), so you still get to hear that rich voice of his.

Year to date, our aggregate total project costs financed is $7.55 million. Only $430.4 million and seven quarters to go until $2 billion…
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Happy New Year! (In October?)

The SBA’s fiscal year began on October 1st, so SBA lenders nationwide are working on their resolutions. Probably lots of the usual stuff: eat better, quit smoking, join a gym, do more loans, etc. We’re not big on new year’s resolutions, so we’ll just keep helping small business owners. Business as usual. We’ll probably take a break to do some Halloweening later this month, but that won’t deter us from providing the best commercial real estate financing experience for small business owners nationwide.

Featured Project:
Safe ‘n Secure Garage Door
Specialists, Inc. dba Besser Bros.

- $1.05 million total project cost
– 7,088 sf Industrial building (acquisition)
– Santa Ana, CA
– 8 jobs created/retained

In the early 1990s, Byron Burland moved from South Africa to Southern California. He opened Safe ‘n Secure Garage Door Specialists in 1994, focusing on sales and service for residential home owners and developers. The company expanded into Orange County in 2000 and continued growing thanks to new HOA clientele, online marketing, and traditional word-of-mouth. In 2005, Safe ‘n Secure acquired Besser Bros. — one of the largest and oldest garage door companies in the area — whose owners were retiring. The company continues to be the finest full-service garage door company in Southern California.

Typically our clients purchase or build larger facilities to accommodate growth or expand operations, but Besser Bros. bought a building that was slightly smaller than the one they previously occupied. Seems strange, but there’s a good reason. At the old location, company trucks had to be parked inside the warehouse because they were loaded with tools and parts. They couldn’t risk someone stealing anything valuable, so much of the warehouse was used as parking space. The new property features a fenced-in yard that will protect the vehicles and equipment, and will give the company about 5,000 more usable square feet for inventory.

Each and every one of our small business clients has a different and unique situation. Just like there’s no one-size-fits-all commercial property for every business, there’s no one-size-fits-all approach to commercial real estate financing. Sure, we only specialize in SBA 504 loans, but each project is different and requires individualized attention and problem solving.

Tip of the Month: Be Patient

Buying or building commercial real estate for a small business isn’t something to rush into. It’s a big decision and requires a lot of due diligence, patience, and flexibility. It’s sort of like buying a home, except that it’s not really at all like buying a home. It’s a complex transaction — one that we’ve spent years refining and perfecting.

Let’s assume you found the perfect commercial property for your business. It’s the right location, right price, and it has everything you need (no construction or renovations). It’s possible that a project like this can get to the closing table in 30 days (we’ve done it before), but it’s not the norm for most of our clients. There are many more moving parts to a commercial loan than a residential one, and any unforeseen hiccup along the way can cause a delay. Even though small business commercial real estate financing is all we do and we’ve been at it for more than a decade, it’s very hard to predict what to expect at every turn during the process.

For example, we worked with a small business recently who wanted to purchase and renovate two office buildings. The two buildings were built in the early 1970s and appeared nearly identical. Our client knew from an early inspection that renovations would be required to remove asbestos that was found in the walls and ceilings. When the demolition crew began working on the drywall and ceiling tiles, they found that one of the buildings lacked proper structural support and required a great deal of unplanned-for work to be done to bring it up to code. Even though this is an extreme example of a “hiccup” during the financing/construction process, it’s a real situation that we and our client had to face.

So…since we’ve been doing this for more than a decade, we should have ironed out all the kinks by now, right? Well, we’ll probably be able to get your project done quicker and with fewer headaches than other commercial lenders. But every project is unique, with its own set of challenges. Our experience and expertise makes it possible for us to anticipate, react, and work through the myriad obstacles that can hamper a commercial real estate loan. That’s what you get when you work with an SBA 504 loan specialist like us. We know better than to try to sell you on promises that are impossible to deliver. You can trust us to give you straightforward and honest answers to all your questions about small business commercial real estate financing.

About SBA 504 Loans

- Up to 90% loan-to-cost financing for owner-occupied commercial real estate
- Office, industrial, medical, flex, daycare, retail, self-storage, and flagged hotel
- Total project costs up to $15 million
- Less impact on cash flow means greater flexibility for property owners

Our SBA 504 loans (sometimes we call them SmartChoice Commercial Loans) have a three-part structure, which is ultimately beneficial for both our small business clients and for third-party lenders we work with. A typical project has a 50-40-10 structure, and we’re dealing with the total project cost which includes the purchase price of land and/or existing building(s), construction costs, soft costs, closing costs, and equipment. This means our clients’ out-of-pocket costs are kept to a bare minimum.

The 50% 1st mortgage is an ordinary commercial loan provided by a third-party lender. This is at market rates and can have up to a 30-year amortization. Current rates for this piece will be in the 5.25%–6.25% range. The 40% 2nd mortgage is a below-market, fixed-rate bond with an SBA guarantee. This piece is fixed for 20 years and has a 20-year amortization. Current rate is 4.82% (as of October 2014).

Small business owners are required to put down as little as 10% of the total project cost, which is two to three times less than ordinary commercial loans require. Equity in land (if it’s already been purchased) and soft costs (like architectural and engineering fees) can count toward the equity requirement. The interest rates from the 1st and 2nd mortgages blend to an effective rate that’s hard to beat with ordinary commercial real estate financing. For a total project cost of $10 million, the blended rate would be 5.28% and the approximate monthly payment would be $57,156 (all rates and figures are current estimates at time of issue).

For customized loan scenarios and payment calculations, download our SmartChoice Commercial Loan Calculator for your iPhone or Android device today.
**Note: Additional equity is required for certain projects involving companies that have been in business less than two years and/or properties that fall into the “special-use” category. Thus, the 50-40-10 structure is typical but not guaranteed.

How can we help you?

Whether you’re a small business owner who wants to own commercial property for your business…or you work with small business clients who do…you may have questions and/or concerns about commercial loans. We want you to know that we’re here to help. Even if an SBA 504 loan isn’t the best solution for your project, we’ll let you know right away and help point you in the right direction. We’ve built our business on being good at what we do and shooting straight with our clients and referral partners. Quick answers and unparalleled expertise is what you’ll get when you call or email or fax or tweet or drop by our offices. Let us know what questions/concerns you’d like us to address. You can even leave a comment below so others can see your question and read the answer (chances are, someone else is wondering the same thing you are).


We’re currently working on a series of videos and blog posts all about construction financing. It’s something that’s become a specialty of ours in the past few years, and many other lenders are often too risk-averse to take on many construction deals. We’re going to explain what you need to know about small business construction projects so you know what you’re getting into before you get into it. We hope it’ll be a helpful, magical thing.

Happy New Federal Fiscal Year!

- Your 504 Experts

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We’re building buildings! (Well, providing the financing, at least.) Construction projects accounted for 62% of our lending activity last year, so we’ve become pretty darn good at this type of lending (if we do say so ourselves).

If you’ve ever encountered a lender (or lenders) who shy away from construction financing, you ought to read our latest blog ( You’ll also learn how small business owners can plan for future expansion and generate possible income at the same time with SBA 504 loans.

Or, if you’re not in a blog-reading mood, just call us: 1-866-622-4504. Phones are faster sometimes.

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We Are Mercantile – The SBA 504 Experts

Up until about a month ago, you were on the receiving end of emails, blogs, and videos featuring a single person as the face of our company. We’ve fielded quite a few questions about what the departure of our CEO means for Mercantile going forward, and the short answer is that nothing changes.

But there’s a longer explanation that we’d like to give you by way of video so that you can know and see a little about what goes on behind the scenes here at Mercantile. What we do for our small business clients has been a team effort from the very start. We’re known as “the 504 Experts” (plural) and we’re a hardworking group of people dedicated to providing the best service and experience for our small business clients.

Let us know if you have questions about who we are, what we do, what we’re about, or how we can help you or your small business clients. Email us at, call 1-866-622-4504, or leave a comment below. We’re all ears. 

- Your 504 Experts

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One key aspect of successful businesses is the ability to strip away all unnecessary details. Whether that's the overall message the company is trying to relay, or the design of the actual products they sell, the old KISS (Keep It Simple Stupid) principle is essential.

Apple, a company that is known for its elegantly designed products has embraced that principle wholeheartedly. They've gone as far as taking their design cues from Pablo Picasso. Read on to find out how his work has inspired the design of the Apple TV remote.

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What should be at the top of the to-do list for the new SBA Administrator? American Banker posed this question to Chris and 14 other bankers. Here's what he had to say:

"The thing I'd like to see the administrator do is continue to push to enable 504s to do refinances, to bring that program back. There's been some movement in Congress, but I think she should go on record and really do some arm-twisting — if that's the right word — to get Congress to act on this. There are a tremendous amount of commercial mortgages that will be ballooning from 2015 through 2017, and the 504 would help to a lot of those small businesses to refinance those ballooning mortgages.

A program allowing refinances passed as part of the Small Business Jobs Act of 2010. It was only in place until September 2012, because it was a 24-month program. The agency took 11 to 13 months to promulgate all of the regulations, so it really wasn't fully operational until those last 11 to 13 months. We tried really hard to get it extended. But because 2012 was a presidential election year, it was awfully hard to get that on the radar screen.

I also would love to see her voice support for and try to bring back the First Mortgage Loan Pooling program. Again, that was a program that was part of the Jobs Act and was extremely beneficial for the short run it had. It still would be tremendously helpful, particularly as it relates to the current banking regulations and restrictions on certain property types and whatnot. This is a program that would enable a lot of those types of projects to get financed.

These were budget-neutral programs, extremely well liked by the lending community and the entrepreneur community. Yet the agency took a long time to write all the rules for them and, by the time it did, the programs shortly thereafter ended and they just didn't get reinstated. It's quite a shame, to be honest."


#sbawishlist   #smallbusiness   #504refi   #FMLP  

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GOAL! (and other soccer words)

It’s World Cup time, which means most of the world is watching soccer with an even greater interest than usual. We, too, have World Cup Fever, but we would never let it get in the way of your commercial real estate financing needs. However, if you do happen to call during a USA match, you’ll probably have to leave a message. Just fair warning. With that lone World Cup caveat, here’s your June 2014 Commercial Finance Update…


Featured Project:

Planet Fitness
-Muncie, Indiana
-90% loan-to-cost financing
$1.18 million total project cost (acquisition and construction)
26,660 square foot fitness facility
-9 jobs created

Since the World Cup is upon us, it makes sense to feature one of our fitness-related clients this month. Mike Campagnolo is in the process of building 21 Planet Fitness Clubs in the greater Indianapolis area. With seven clubs up and running, he’s well on his way. Mike decided to acquire an aging retail strip center in Muncie, IN, and rebuild it into a state-of-the-art fitness center, and we had the honor of financing his project. We provided both the temporary 1st and interim 2nd mortgages during the construction process (keep reading for more about loan structure). We also participated in a second SBA loan to finance the necessary equipment for the gym. Small business construction financing has become a niche specialty of ours, so call us when you or someone you know has a construction project we should take a look at.

Go to for videos and more...


Tip of the Month: Don't price-shop.

Choosing a commercial lender solely on price is unwise. It’s sort of like having surgery: you wouldn’t pick the doctor who charged the lowest price to operate on you, right? When you’re evaluating lenders for your commercial real estate project, it’s important to look at their level of expertise. Do they specialize in the type of loan you need? How many of this type of loan have they closed? Have their clients been happy with their experience? It’s worth the extra effort to find a lender who has a reputation for being the expert in providing the type of loan you need. We’ve been small business commercial real estate specialists for more than a decade, so call us first when you or someone you know is interested in owning commercial property. We’ll be more than happy to cut your lender search short so you can get back to doing what you do best.

Learn more at


For Small Businesses (Owner-Users): The SmartChoice Commercial Loan

-Up to 90% loan-to-cost financing for owner-occupied commercial real estate.
-Property types include office, industrial, medical, flex, daycare, retail, flagged hotel, and self-storage facilities.
-Total project costs up to $15 million.
-Makes commercial property more affordable for small business owners.

Read the full update at

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When you're planning for growth in your small business, here's a reason to consider staying small: Niche Domination. Growth for growth's sake is never a good thing. Read more about why staying small can be a big thing for your business at

#smallbiz #tipoftheday #staysmall #smallgiants #dontgettoobigthatscrazy

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We decided to rethink the format for our May 2014 Commercial Finance Update, and here's why:

We (you and us and everybody) are reading a lot of email on our mobile devices these days. This isn't a major discovery, just something we've realized is important when we communicate with each other. Instead of sending emails with links to websites, we've put our entire Commercial Finance Update in a mobile-friendly package. There's still a print-friendly version, too, and you can see/get both at

If this is helpful to you at all, please share it with a small business owner you know. Thanks in advance!

#smallbiz #commercialloans #sba504
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