American manufacturing is experiencing a resurgence as companies prioritize domestic production and supply chain resilience. For manufacturers ready to own their facilities, SBA loans provide accessible financing that preserves working capital while building long-term equity. Whether you're expanding an existing operation, relocating to a larger facility, or starting a new manufacturing business, SBA programs can help you acquire the industrial real estate you need.
Why Manufacturing Facilities Qualify Well
Manufacturing businesses have characteristics that appeal to SBA lenders. They create jobs, contribute to the local economy, and often have significant equipment assets that provide additional collateral. Industrial real estate tends to hold value well, and manufacturing operations typically generate stable cash flows from long-term customer relationships.
The SBA 504 program particularly favors manufacturing because it was designed to promote job creation and capital investment. Manufacturers expanding their facilities and adding jobs often find 504 loans especially attractive.
Types of Manufacturing Facilities
- Production Facilities: Assembly lines, fabrication shops, processing plants
- Warehouse/Distribution: Storage and logistics operations
- Flex Space: Combined office and production space
- Heavy Industrial: Foundries, metal working, large equipment manufacturing
- Light Industrial: Assembly, packaging, light fabrication
- Food Processing: Commercial kitchens, food production facilities
SBA Loan Requirements
- Down Payment: 10-15% of total project cost
- Credit Score: 650 minimum, 680+ preferred
- Experience: Manufacturing or industry experience strongly preferred
- Financial History: 2-3 years of business tax returns for existing businesses
- Collateral: Real estate plus equipment provides strong security
Facility Requirements to Consider
Manufacturing facilities have specific requirements that impact costs and financing:
- Ceiling height: 16-32 feet for production areas
- Floor load capacity: Adequate for equipment and inventory
- Electrical capacity: Three-phase power, adequate amperage
- Dock doors: Loading dock access for shipping/receiving
- Crane systems: Overhead cranes if needed for heavy materials
- HVAC: Climate control for workers and processes
- Sprinklers: Fire suppression systems
- Yard space: Trailer parking, outdoor storage
Equipment Financing Integration
Manufacturing businesses often need significant equipment investments alongside real estate. SBA loans can include equipment financing, allowing you to acquire machinery, production lines, and other capital equipment as part of your project. This comprehensive approach simplifies financing and often provides better terms than separate equipment loans.
- CNC machines and production equipment
- Material handling systems
- Quality control and testing equipment
- Packaging and shipping equipment
- Environmental and safety systems
Financing Structure Example
A typical manufacturing facility acquisition:
- Real estate value: $2,000,000
- Equipment: $500,000
- Renovations: $300,000
- Working capital: $200,000
- Total project: $3,000,000
- Down payment (10%): $300,000
- SBA loan: $2,700,000
Ready to Own Your Manufacturing Facility?
Get pre-qualified for SBA industrial real estate financing today.
Check Your EligibilityEnvironmental Considerations
Manufacturing facilities require environmental due diligence. Lenders will require Phase I Environmental Site Assessments to identify potential contamination issues. If concerns are found, Phase II testing may be needed. Clean environmental reports streamline the loan process, while properties with issues may still qualify with appropriate remediation plans.
Tips for Manufacturing SBA Loan Success
- Document production capacity: Show how the facility supports revenue growth
- Highlight customer relationships: Long-term contracts and repeat customers strengthen applications
- Detail equipment needs: Include comprehensive equipment lists with quotes
- Address environmental concerns: Proactive environmental assessments avoid delays
- Plan for utilities: Verify electrical, gas, and water capacity for your operations
Industry-Specific Opportunities
Certain manufacturing sectors are experiencing particularly strong growth and lender interest:
- Defense/aerospace: Government contracts provide stable revenue
- Medical devices: Growing healthcare demand drives expansion
- Food processing: Essential industry with consistent demand
- Automotive suppliers: EV transition creating new opportunities
- Precision manufacturing: High-value, skilled operations