Case Study: $1.7 Million Proforma-Based SBA 7(a) Loan for Sports Complex Acquisition
Overview
- Transaction Type: Business Finance & Commercial Real Estate Acquisition
- Loan Amount: $1.7 Million
- Loan Program: SBA 7(a) (10% down)
- Asset Type: Multi-Acre Sports Complex (with potential for F&B and club development)
- Asset Type: National—applicable to sports facilities across the U.S.
Cornovus Capital, a leading commercial real estate and business finance advisory firm, successfully structured a $1.7 million SBA 7(a) loan for the acquisition and revitalization of a sports complex. By leveraging proforma-based underwriting and the borrower’s prior operational success in a similar sports facility, Cornovus Capital secured an attractive 10% down arrangement. This approach preserved much-needed capital for expansion, enhanced programming, and new revenue streams such as tournaments, club memberships, and food & beverage (F&B) services.
Key Challenges
- Proforma-Driven Underwriting
- Traditional lenders often hesitate to approve deals heavily reliant on future revenue projections.
- Demonstrating the borrower’s proven track record in sports facility management was critical to persuading underwriters.
2. Underutilized Facility
- Existing ownership had not actively pursued new business or facility upgrades.
- The borrower aimed to tap untapped market demand for regional and national sporting events.
3. Capital Allocation
- With only 10% down, the borrower wanted to retain funds for renovations, marketing, and program development.
- Securing flexible terms on an SBA 7(a) loan was essential to maintaining positive cash flow.
4. Nationwide Opportunities
- To ensure broad appeal for future sports events, the financing structure needed to accommodate potential regional or national tournaments and cross-state marketing campaigns.
Cornovus Capital’s Approach
- Comprehensive Financial & Market Analysis
- Conducted in-depth due diligence, including revenue modeling, expense projections, and ROI calculations.
- Validated the borrower’s past performance at a similar sports complex, highlighting the potential for nationwide tournament draw.
2.Proforma Validation & SBA 7(a) Structuring
- Built a robust proforma showcasing projected revenue from F&B sales, tournament hosting, and club memberships.
- Positioned the borrower’s prior experience as evidence of operational expertise, enhancing lender confidence.
3.Negotiation of Flexible Terms
- Collaborated with SBA-preferred lenders to secure competitive rates and an amortization schedule aligned with the borrower’s growth timeline.
- Achieved a 10% down structure to support ongoing improvements and marketing.
4. Streamlined Closing & Transition
- Provided step-by-step guidance through the SBA 7(a) application and closing process.
- Coordinated with legal counsel, appraisers, and other stakeholders to ensure timely funding.
Results & Impact
- Successful Acquisition with Minimal Equity
- The borrower acquired the sports complex using just 10% down, preserving liquidity for immediate operational enhancements.
- Planned facility improvements and program expansion will attract a national audience, increasing tournament hosting and securing long-term profitability.
- A revitalized sports complex has the potential to draw teams and spectators from across the U.S., driving local tourism and supporting surrounding businesses.
- This proforma-based SBA 7(a) model can be replicated in multiple regions, paving the way for additional sports complex acquisitions nationwide.
About Cornovus Capital
With 60+ years of combined experience, Cornovus Capital specializes in a wide range of commercial real estate and business finance solutions. We partner with:
- SBA Lenders (7(a) and 504)
- CMBS & Life Insurance Companies
- Private Capital & Debt Funds
- Regional & National Banks
Whether you’re expanding a sports facility, developing a hospitality project, or seeking owners’ representation for business acquisitions, our client-centric advisory team creates customized financing strategies that align with your long-term goals.
Why Choose Cornovus Capital?
- Proforma Expertise: Deep understanding of future revenue modeling for niche assets.
- SBA 7(a) Focus: Solid relationships with SBA-preferred lenders, facilitating fast approvals.
- Nationwide Reach: Our solutions cater to projects across the U.S., from local expansions to multi-state portfolios.
- Holistic Advisory: Comprehensive support—from initial feasibility analysis to final closing coordination.
Contact Cornovus Capital Today
Ready to structure an SBA 7(a) loan for your sports complex or other commercial venture?
Reach out to Cornovus Capital for a tailored consultation on how we can help secure the financing you need.