Financing your business in Red Bank
April 18, 2016
Are you interested in starting a business in Red Bank?
It is no secret that Red Bank has become one of the hottest commercial real estate sectors in the tri-state area. In one of the firm’s recent press releases, Kenneth Hollenbeck, our firm Managing Partner, explained that Red Bank, and Monmouth County in general, is an area that has boomed in recent years
“We are excited about the continued growth prospects from our Monmouth County presence, and look forward to serving both local and national clients from our new Red Bank location,” according to Hollenbeck.
With close to 400 businesses, Red Bank has become a vibrant business sector. It now offers the same amenities as Midtown Manhattan and nearby Jersey City and Hoboken with everything from schools, industry and tech to retail, dining and entertainment. There is also the attraction of beaches and desirable destinations that draw a large number of residents and visitors from the tri-state area. Based on all of these factors, combined with convenience and value, Red Bank recorded more than $6.75 million in average annual revenue per business in 2015, the second best in the top 10 cities in New Jersey, according to a NerdWallet report.
With this increased demand for business in Red Bank, many entrepreneurs are seeking to set up shop there. But they are not sure how to go about doing it. Aside from filing the necessary paperwork with the borough for a certificate of occupancy, or even winning approval from the borough planning board, many small entrepreneurs are wondering how to finance their business in many of the town’s upscale locations.
There are several options for entrepreneurs and start-up companies to secure funding to start a business in Red Bank. Many entrepreneurs opt for private lending channels, but the state of New Jersey has several lending and grant options available in which many may not be aware.
These business accelerator programs are intended to boost the local economies of certain regions. It is one of the state’s latest efforts to support small companies in the early stages of development and start-ups.
These options can be instrumental in securing commercial space in Red Bank because it is premier real estate, and purchasing and leasing commercial space in the area will not come cheap. But listed below are some potential options to explore when thinking about starting a business in Red Bank:
Many of these lending programs from private banking and third-party institutions are ideal for start-ups and small businesses. This may seem an obvious point, but depending on the financier, private loans may be most beneficial to entrepreneurs because of the flexible repayment options with 6-18 month loan terms or fixed and variable payment schedules. Several types of these loans are also tax deductible, require no collateral with creditworthiness and may be renewable upon completion of the original terms.
New Jersey’s small to mid-size business assistance programs
There are several lending programs for small to mid-size businesses offered by the state. Among the most popular offered include the Grow NJ Assistance Program, HMO Assistance Fund Tax Credit and New Jersey’s Small Business Set-Aside Program.
The state has numerous subsidiary agencies for entrepreneurs such as the New Jersey Business Incubation Network, Export-Import Bank of the United States Export Financing Assistance, Union County Economic Development Corporation’s Small Business Services, U.S. Small Business Administration Export Financing Assistance and the U.S. Small Business Administration’s New Jersey District Office. These providers offer loans and bond financing options for a variety of legal sector as well as industrial and retail business sectors.
Among the more feasible options offered by the Economic Development Authority is the Premier Lending Program. This program develops opportunities for small businesses and start-ups with low-cost borrowing opportunities and a faster turnaround than most lending programs.
The Economic Development Authority also offers direct loans. This agreement from the state offers entrepreneurs loans when financing is not available under any other Economic Development Authority programs. These direct loans are intended as a stimulus package for job creation and retention.
Small Business Fund
The Small Business Fund is a grant program designed specifically for creditworthy small businesses that are minority- or women-owned. This financing option is ideal for an entrepreneur like an attorney in Red Bank because of its small but elite downtown locations. With this type of loan, minority and female entrepreneurs have access to financing that they would not otherwise have access to from a banking institution.
New Jersey Business Growth Fund
This program is a joint venture between the Economic Development Authority and PNC Bank as part of an initiative to create more jobs. Many small to mid-size businesses may be eligible to financing that would not otherwise be available to them through this fund.
New Jersey Advantage Program
This job creation stimulus package is another program designed to provide start-ups and small businesses with access to seed funding to start a business in Red Bank. As a joint venture between the Economic Development Authority and TD Bank, entrepreneurs may want to look into this financing program if they are interested in launching a business in the Red Bank area.
Regardless of the type of financing, there are several options available to start a business in Red Bank. And time is of the essence. As Lewis Zlotnick, president of Woodmont Properties, explained recently in an interview with Real Estate Weekly, Red Bank is the next great location for development projects as his firm is developing the West Side Lofts in the Arts District.
“We’ve received a number of applications from residents who are interested in our West Side Lofts property that have come from New York City.” Zlotnick explained. “In addition to the rising prices in Manhattan, there are various perks that are drawing more and more people to New Jersey. At West Side Lofts, we find that walkability and convenience are equally as important as affordability. Our residents have access to nightlife, restaurants, the beach, theaters and entertainment at their door step at half the price it would cost to live in Manhattan but they also appreciate the convenience of a short walk to the train to NYC.”