Featured Loan:
Ocean Shores Kites uses rural loan to soar

Seasonal tourism is the economic foundation of many small rural communities.  Ocean Shores in Grays Harbor County, Washington is one such town with a year-round population of about 4,000. It is a popular fair-weather vacation destination.

Over the last ten years Andy and Brenda Sias, the owners Ocean Shores Kites, have created more than a retail store. They offer help in choosing the right model for their customer's skill level and a repair service for the inevitable pilot error. They also sell windsocks, wind chimes and flags to appeal to a wider market and to help get through the lean winter months. The local seasonality requires business owners to have strong budgeting and cash flow management skills.  The Sias's say they are "frugal and get by fine," but expansion was a challenge.

Their main store has a beachfront location that attracts a lot of foot traffic. Rather than expand it they experimented with leasing a second spot near the convention center for a few years. The risk was that the second store would eat away at sales from the first, but it attracted more vehicle traffic and overall sales increased.

When Andy and Brenda heard about attractive new commercial condos being built only blocks from the beach and on the main street in town they knew owning one could work for their business. The seven little cabins with a shared boardwalk were between two key tourist destinations - a go-cart track and a family fun center.  But a low down payment was the critical factor. "We wanted to take advantage of this retail ownership opportunity, but twenty percent was so far out of reach."

Andy and Brenda went to Alice Carrillo at The Bank of the Pacific, their long-time banker. "Alice knows us," they said. Alice also knew the condo project. The bank was financing the developer.  She suggested Evergreen's Rural Loan Program. 

Melissa Suposs, Evergreen's Rural Loan Officer worked with Andy, Brenda and Alice to put together a 50% bank /40% Evergreen/10% borrower financing structure. This was similar to an SBA 504 loan, but the rural loan made more sense because of the smaller purchase price. The fees were also lower. "The low down payment, that was the big thing," says Andy.

Rural areas can have real estate that is relatively less expensive. Evergreen's Rural Loan Program is well suited to financing small buildings and commercial condos with a low purchase price. As a low-down-payment, long-term, low-fee solution it allows small business owners to keep cash available for other needs.

The Sias's say, "The 10 percent down was sole reason we could buy this building and working with Evergreen was really very easy. Melissa let us explain our story. We are not super high-tech, but we worked on the phone, online and via fax and did not have to interrupt our business to go into an office."

Now fair winds are blowing. Sales in the new second store are looking even better than their test location. Careful planning and the right financing solution are taking Ocean Shores Kites to new heights.

USDA Rural Development is an Equal Opportunity Lender, Provider and Employer. Complaints of Discrimination should be sent to: USDA, Director, Office of Civil Rights, Washington, D.C., 20250-9410