Last modified on April 15th, 2020
By Brittany Benz
As the number of unemployment claims in the U.S. continue to rise and businesses struggle to maintain their operations, many are searching for ways to soften the financial hardship during these unprecedented times. We understand that for many property management companies, it has been a daily challenge to keep their operations running, which is why we have been researching all of the resources we can to provide support. Here’s a list of the latest financial resources available for property management businesses:
The CARES Act
Also known as the Coronavirus Aid, Relief, and Economic Security Act, this initiative was recently passed by Congress to assist small business owners during COVID-19. Since financial assistance will be given on a first-come-first-serve basis, it’s best to apply through SBA.gov sooner rather than later. While the act is fairly complex and requires specific eligibility requirements, you can use SBA’s table of small business size standards to determine if you’re eligible. In addition, we recommend consulting your legal and accounting teams to better understand how your business should proceed.
Here’s a breakdown of what the CARES Act offers for those in the multifamily sector:
- Allows employers with less than 500 associates to apply for up to $10 million in financing or 2.5 times the average monthly payroll costs for rent, mortgage, utility, and payroll obligations.
- If a business has suffered financially this year more than previous years, it will provide a tax credit of up to 50% of what the business spends on employee wages (with a maximum of $5,000 per employer).
- Allows employers to delay the payment of the employer side of Social Security taxes.
- Expands the SBA Express Loan program by increasing the maximum allowable financial assistance from $350,000 to $1,000,000.
- Broadens the terms of the Small Business Administration’s Standard Loan, Express Loan, and Economic Injury Disaster Loan Programs (EIDL).
Additional Programs under the CARES Act
Economic Injury Disaster Loans:
- Low-interest (3.75%) fixed rate loans of up $2 million dollars, up to 30 years maturity.
- Can be used to pay immediate expenses such as payroll, bills, accounts payable, and fixed debts.
- Emergency advance enables businesses that are currently experiencing temporary financial hardships to request a $10,000 loan advance to be received within three days of applying.
SBA Express Bridge Loans:
- Enables businesses who already have a relationship with an SBA Express Lender to access up to $25,000 fast.
- One thing to note is that this loan must be repaid in full or in part by the proceeds from an Economic Injury Disaster loan.
SBA Debt Relief Program:
- Small businesses can defer previous microloans, of which the SBA will automatically pay the principal, interest, and fees for a period of six months.
- The SBA will also automatically pay the principal, interest, and fees of new microloans issued prior to Sept. 27, 2020.
Important Note: At the moment, this act prohibits multifamily businesses from participating in the Paycheck Protection Program, which provides loans to small businesses if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.
For more information on the CARES Act take a look at this comprehensive guide from the NAA. In addition, check out this detailed webinar for more information. The SBA also offers free business counseling for those in need.
Additional Financial Resources by Region:
Main Street Launch
In partnership with the city of San Francisco, this company is offering 0% interest loans up to $50,000 at terms of up to six years. To be eligible, your business must be in San Francisco and have a total revenue of under $2.5 million annually. In addition, your business must have experienced a 25% drop in revenue since January 1, 2020.
Los Angeles City Small Business Emergency Microloan Program
The city of Los Angeles is offering small businesses that are responsible for providing low-income jobs with emergency microloans of $5,000 to $20,000.
Utah Leads Together Small Business Bridge Loan Program
This program is using the $11 million in state funds to provide gap funding to small businesses in Utah with less than 50 employees. Those who are eligible can receive a loan of up to $20,000 at a 0% interest rate for up to 60 months.
Chicago Small Business Resiliency Fund
For small businesses in Chicago who can prove they have experienced a 25% drop in revenue and have less than $3 million in annual revenue, the city of Chicago is offering low-interest loans of up to $50,000.
Small Business Emergency Loan Program
This program in Minnesota is offering loans of up to $35,000 to help Minnesota-based small businesses cover operating expenses. To qualify, you must have less than 250 employees and have been negatively impacted by COVID-19.
Florida Small Business Emergency Bridge Loan Program
For businesses in Florida with less than 50 employees, this program is offering loans of up to $50,000 and even $100,000 in some cases and at a 0% interest rate for one year.
Louisiana Small Business Loan Guaranty Program
If your business is located in Louisiana and has fewer than 100 employees, you can apply for a loan of up to $100,000 with no payments due for six months.
North Carolina COVID-19 Rapid Recovery for Small Businesses
Created for small businesses across the state of North Carolina, this program is offering loans up to $50,000 at six months of no interest or required payments.
NJEDA Small Business Emergency Assistance Loan Program
In response to COVID-19, the city of New Jersey has launched a $10 million initiative to help small businesses. Through this program they are offering loans of up to $100,000 to businesses who have less than $5 million in annual revenue.
COVID-19 Working Capital Access Program
For Pennsylvania-based businesses with less than 100 employees, the Pennsylvania Dept. of Community and Economic Development is granting loans of up to $100,000 at a 0% interest rate.
Facebook Small Business Grants Program
For small businesses with less than 50 employees that have experienced financial hardships due to COVID-19, Facebook is offering grants to keep your workforce going strong.
As we work through these challenging times together, it’s important to remember you’re not alone. We will continue to update this article with the latest financial information as it becomes available. However, if you’re interested in one of the organizations listed above, it’s best to contact them personally, as details may change after this has been posted. In addition, if you’re looking for ways to support your residents, we suggest you read and share our blog on top financial resources for residents. Stay well and positive!