SBA 504

The SBA 504 Loan Program is Prairieland EDC's premier program. The program was created in the 1980s with the goal of assisting communities in creating jobs and expanding the local tax base by stimulating small business investments in facilities and equipment. The 504 program is a small business's access to capital that provides long-term financing with fixed rates, low down payment, and reduced lender risk. SBA 504 loans can be used for land and building acquisition, new construction, renovation, machinery and equipment, leasehold improvments, and furniture and fixtures.

SBA 504 Loan Specifics
Areas Served PEDC Service Area (MN and parts of SD and IA)
Loan Amount
$50,000 - $5,000,000 (Up to $5,500,000 on manufacturing & energy)
Terms 10 to 20 year (fixed interest rate)
  • For profit business
  • Must be owner occupied
  • Business net worth must be less than $15 million
  • After tax net profit must be less than $5.0 million average for the past 2 years (or alternative size standards may apply)
  • Proceeds can be used for real estate acquisition and/or construction or the purchase of long term machinery and equipment
  • Refinancing of existing debt may be eligible as part of an expansion project
  • Must have private sector lender commitment of up to 50% of the project
  • 40% maximum SBA participation
  • Borrower injection from 10 to 20 % of project

SBA 504 Loan Example