JUNE 2009 For M or t ga ge B roker s , Corres p on den t s , Len der s an d Whol es al er s AltAmonte SpringS, Fl -- this past April Fool’s Day, the management at mercantile commercial Capital Corp. here played a little joke on the industry, claiming it had obtained the naming rights and become the exclusive originator for the Small Business Administration 504 loan program from the obama administration. But Behind the joke was an effort to raise the profile of the product in a time when fundin

1. JUNE 2009
For M or t ga ge B roker s , Corres p on den t s , Len der s an d Whol es al er s
Altamonte Springs, FL -- This past their friends and family in starting their busi- SBA program in general has been in the
April Fool’s Day, the management at Mer- ness in the first place. “So they don’t exactly spotlight the last few months. This is more
cantile commercial Capital Corp. here played follow conventional wisdom. These tend to attention the program has received than any
a little joke on the industry, claiming it had be a little more independent free thinkers, a time he has been in the business, MR. Hurn
obtained the naming rights and become the little more contrarian,” He noted. said.
exclusive originator for the Small Business From his clients, they are viewing right SBA is being seen in the market as a
Administration 504 loan program from the now as a huge opportunity. Assets have been source of funding and not as a lender of last
Obama administration. discounted , commercial property can be resort. Mercantile has capital to lend, includ-
But Behind the joke was an effort to acquired at a much better value than it was a ing large commercial warehouse lines and
raise the profile of the product in a time year or two ago. some of its product is sold in the secondary
when funding for commercial real estate has Financing terms market “and that hasn’t been a problem for
become scarce. Doctors, from those us either,” he said.
The SBA 504 loan program offers companies still Right now the company is seeing
business owners up to 90% financing to lawyers lending are near increased demand for doctors and lawyers
develop acquire, and remodel commercial
facilities.
fueling historical lows.
“So it is a great
looking to own the buildings their offices
occupy. That represents 30% of the deals
Overall, The market for small balance demand. time if a small closing over the next few months. And Mr.
commercial has been tough for most lend- business owner Hurn noted these are the clients that a bank
ers, but Mercantile has been doing well. has enough would normally falling all over themselves
Christopher Hurn, Chief executive, courage to go out and buy their own prop- to lend to, just for the relationships. There’s
noted the company finished 2008 closing erty and stop leasing. And that’s what has also demand from limited service hotels,
only four fewer loans than in 2007, Which been stimulating our growth these last few freestanding restaurants and day care provid-
was the company’s best year ever. The First months,” Mr. Hurn said. ers.
two months of this year were slow, “But it Mercantile expects to be breaking per- At one point, the management of the
has been a rampage ever since,” he said, as month closing records this summer. And company was looking to start a commercial
right around the same time the stimulus bill that success, he continued, is because the bank, in part as a source of funding. It actu-
took off, demand took off, “to the point company has stuck to what it does best. It ally had received Office of the Comptroller
where we’ve never seen this much deal flow. only finances commercial properties for of the Currency approvals but an apparent
There are a lot of factors for it, I think. One, business owners and entrepreneurs. It does moratorium on approvals by the Federal De-
of course, is that there is just not a lot of not want to be the kind of lender that is all posit Insurance Corp. Scrapped those plans.
folks that we compete against out there that things to all people. “We wanted to be the So mercantile went to Plan B, and it
are lending money, they are still frozen.” best at our particular niche and we think we kept doing what it had been doing with no
Mercantile has benefited as the borrow- are.” distractions on its focus, which is good right
ers have found it because it has been lending Recently it expanded its office space, add- now as demand has never been better for
throughout, Mr. Hurn said. ing 2100 square feet, bringing it to a total of the company.
The other thing that stimulated demand 7,000 square feet and has hired five people As for the prank, “we caused quite a
is the attitude the small businessperson, he in the last six weeks, with more hiring’s likely ruckus, more so than we expected,” he said,
said, declaring that they get tired of hearing to come. The hiring’s have increased the adding that most people took it in stride. 
doom and gloom all the time. These people employee base 25%.
tended to go against the grain and advice of Further helping the company is that the