Small Businesses Should Take Advantage Of Federal Loan Program

In an article recently published in the Small Business Journal, Leonard Grunstein, a well-known New York City real estate expert, detailed how recent changes to a federal program can give small businesses a leg up. The Small Business Administration’s 504 Loan Program can help small businesses access loans for real estate mortgages.

The SBA 504 Loan Program addresses an important need in the market place and helps provide commercial real estate mortgage financing to small businesses at competitive rates.

In the paper, he argues that ownership of the real estate where the small business is located could help save a small business from being forced to close because of rising rents or unavailability of the space for re-lease. It can also be a wonderful outlet for diversification of investment by a successful entrepreneur. A retail business owner knows his neighborhood well and understands emerging trends in the local real estate market; this knowledge can be translated into a successful investment.

However, small businesses have a harder time getting approved for loans than larger, more established companies. The difficulties of getting a loan may discourage business owners from investing in real estate, limiting prospects for growth.

The 504 Program helps bridge this gap by letting small business owners take out loans for fixed assets such as real estate and machinery. The program provides for a government guaranty of the bonds of a Certified Development Corporation (a nonprofit entity dedicated to economic development), the proceeds of which are to be used to provide a second mortgage. A first mortgage loan is to be sourced from a bank. The balance is equity, to be provided by the borrower. To qualify for the loan, the business must show that it cannot obtain the financing without the aid of the SBA and demonstrate that it can pay back the loan.

In making the case for the program, Grunstein draws on his own experience helping his father renegotiate the lease of his grocery store, which he calls “no mean achievement.” He also describes a successful loan he made to a retail business early in his career, a loan that allowed the business to benefit from a boom in the local real estate market.

Leonard Grunstein Published in Republic 3.0

Leonard Grunstein was recently published in Republic 3.0, writing a piece titled, “Affordable housing must move beyond rent control.” In the new piece, Grunstein discusses a recent court decision that stated that the rent-stabilized apartments are public assistance benefits akin to disability benefits or welfare. Grunstein notes that while this decision is considered a victory by many affordable housing advocates, it may end up doing more harm than good.

Grunstein argues that the decision signifies the steady acceptance of rent regulation rather than a stopgap. “Originally, New York’s rent stabilization law was passed as an emergency measure meant to shore up affordable housing for the short-term until a more sustainable solution could be passed,” he says.

Within the op-ed, he suggests lifting rent regulations to incentivize developers to replace existing ones that contain more housing of both market value and affordable rates.

To read the full article, visit Republic 3.0.

Leonard Grunstein shares videos of must-see locations around NYC

Leonard Grunstein has recently shared several videos that feature photos of some of NYC’s best places to do business. Bryant Park (Manhattan – New York Public Library), Amster Yard (East 49th Street) and Tudor City Greens (42nd Street – United Nations) have their own unique features that make each park the perfect place to enjoy the outdoors within New York City.

Photo slideshows and full descriptions of each park can be found on Grunstein’s Vimeo and YouTube channels.

Leonard Grunstein shares a video from this spring’s YIVO site launch

Leonard Grunstein has recently shared a slideshow including photos of a YIVO event that took place last May. The event was held in celebration of the launch of YIVO’s Digital Archive on Jewish Life in Poland, a website dedicated to memorabilia from the institute’s collections on Polish Jewry pre-WWII that was made possible in part by the Grunstein family.

The video features photos of the tours, presentation and reception held at the event. Tours were given of YIVO’s archives and rare book collection, followed by a reception and a presentation by YIVO CEO Jonathan Brent that discussed the importance of documenting the heritage of Eastern European Jews. The full video can be found below or on Leonard Grunstein’s YouTube channel.

Leonard Grunstein Proposes A Free-Market Solution To the Affordable Housing Crisis

Leonard Grunstein, Managing Member at Hanlen Real Estate Development & Funding, has published an op-ed piece in the Gotham Gazette, contributing his thoughts on the newly proposed affordable housing plan for New York City.

While Grunstein believes the plan to be a very detailed and progressive means of solving the city’s housing problems, he also suggests a more cost-effective solution – the current plan costing an estimated $41 billion with $8 billion coming from city funds.

Grunstein’s suggestions are outlined in a five-point plan, meant to solve a growing housing crisis and save New York City money in the process. The first two steps proposed in the plan involve the creation of a partnership between the public and private spheres to provide for low-income and mixed-income housing, and taking full advantage of profitable tracts of land in the NYC area – enabling development to reduce the land’s overall costs.

A third point would require developers to lease the ground on which new projects are built, generating ground rents through the luxury component of development. Funding generating by these ground-leases could then be used to assist struggling households, providing them with a transferable voucher to be used for apartment rental. Finally, the plan calls for the creation of an independent affordable housing authority with the power to solve city housing woes using a public-private model.

Success has been had in smaller segments of the city, where agencies of the proposed nature have repaired struggling neighborhoods. With the proper resources in place, this proven plan can bring aid to New York City as a whole.

Leonard Grunstein’s full article can be found at gothamgazette.com.