SBA 504 loans for Franchises
Over the last decade, franchisees have used SBA 504 financing to fund more than $24 billion in real estate, construction, and equipment. We help you secure the same financing — with 10% down, 25-year fixed rates, and a team that knows the 504 program inside out.
The Franchise SBA 504 market, by the numbers
What ten years of Franchise SBA 504 loans — pulled directly from the SBA's own data — tell us about how operators finance this business.
Source: SBA 504 loan approvals for NAICS Franchise flag (all NAICS) , FY2016–FY2025. Data via FOIA request, updated quarterly.
What an SBA 504 loan covers for a Franchise
SBA 504 financing is built for long-term assets — the real estate, infrastructure, and major equipment that anchor a Franchise business.
Property purchase & land
Own the real estate under your franchise instead of renting it. Whether you're buying an approved pad site or the building you already operate in, 504 lets you lock down the location with a low down payment — and stop paying a landlord.
- Brand-approved pad sites and lots
- The building under an existing unit
- Converting an existing building to your brand
- Buying out your current lease
- Multi-tenant pads with your unit as the anchor
Ground-up construction
Build a new unit to your franchisor's exact prototype. 504 covers the shell, the site work, and the brand-standard build-out, so you can open on spec without draining the capital you need to actually run the place.
- Ground-up builds to brand prototype
- Site work, grading, and parking
- Brand-standard interior build-out
- Drive-thru lanes and signage
- Kitchen, HVAC, and utility infrastructure
Expansion & second locations
Franchising rewards operators who scale. Use 504 to add your next unit, hit an area-development commitment, or take over another franchisee's territory — without tying up the cash flow from the units you already run.
- Second, third, and beyond locations
- Area-development and multi-unit growth
- Acquiring another franchisee's units
- Remodels to current brand standards
- Converting an acquired site to your brand
Equipment with long lives
The brand-mandated equipment and fixtures that make a unit run — and last long enough to finance. 504 is built for big-ticket FF&E with a long useful life, so you spread the cost over the years it'll serve you.
- Kitchen and production equipment
- Furniture, fixtures, and equipment (FF&E)
- POS and back-office technology
- Signage and drive-thru systems
- Specialty equipment for your brand
How SBA 504 financing is structured
Three pieces of capital come together so you only put 10% down on a project that might cost millions.
First lien (50%)
APC funds this directly — we're a private direct lender, not a broker. Term and rate quoted upfront.
SBA 504 / CDC (40%)
Second lien, fixed for 25 years through a Certified Development Company. Rates locked at funding.
Borrower equity (10%)
Cash down, retained equity in existing real estate, or seller carry-back in some cases.
Owning your Franchise property beats leasing — here's the math
Slide the inputs to match your situation. The equity number on the right is what you'd have in 10 years if you owned instead of leased.
Where Franchise SBA 504 money is going
Geography, deal sizes, top CDCs, and the banks making it happen — all pulled from a decade of SBA data.
Top 10 states by loan volume
| State | Loans | Total funded | |
|---|---|---|---|
| 1 | California | 755 | $1.3B |
| 2 | Florida | 529 | $874M |
| 3 | Texas | 472 | $858M |
| 4 | Georgia | 334 | $559M |
| 5 | Illinois | 291 | $364M |
| 6 | Wisconsin | 253 | $279M |
| 7 | Minnesota | 229 | $233M |
| 8 | Michigan | 205 | $235M |
| 9 | Indiana | 192 | $199M |
| 10 | Utah | 190 | $259M |
Deal size distribution
Top CDCs financing Franchises
These Certified Development Companies have funded the most Franchise SBA 504 deals over the past decade. Click any CDC for their full profile.
Top 10 third-party lenders for Franchise deals
| # | Lender | Loans | Volume |
|---|---|---|---|
| 1 | Bank Five Nine | 154 | $395M |
| 2 | JPMorgan Chase Bank | 85 | $88M |
| 3 | Poppy Bank | 82 | $424M |
| 4 | Celtic Bank Corporation | 75 | $417M |
| 5 | Wels Fargo Bank | 72 | $114M |
| 6 | TD Bank | 71 | $170M |
| 7 | Meadows Bank | 64 | $149M |
| 8 | Regions Bank | 62 | $129M |
| 9 | Live Oak Banking Company | 59 | $187M |
| 10 | SouthState Bank | 57 | $106M |
What it takes to qualify
SBA 504 has clear, objective criteria. Most Franchise operators we work with qualify.
Business requirements
- For-profit businessSBA 504 is for operating companies, not investors or holding companies.
- Owner-occupied useYou operate the Franchise — you're not just buying real estate to lease out.
- US-based and below SBA size limitsMost Franchise businesses qualify under SBA's small business size thresholds.
- Demonstrated ability to repayCash flow, credit, and business experience all matter — but no perfect score required.
Project requirements
- 51% owner-occupancyYour business must occupy at least 51% of the financed property.
- Eligible use of fundsReal estate, ground-up construction, major equipment, and certain refinances qualify.
- Long useful lifeEquipment financed under 504 must have a useful life over 10 years.
- 10% equity contributionCash, retained property equity, or seller carry — structured to fit your situation.
Most Franchise operators qualify. The fastest way to know is a 10-minute call. 1-855-504-LOAN
Built for Franchise financing
We're a direct lender that specializes in SBA 504 — not a broker, not a generalist.
Ready to finance your Franchise project?
Schedule a 15-minute call. No application fee, no obligation.