When he began his business in 2010, entrepreneur Micah Hogan had no need for commercial real estate, as Southern Outdoor Power, LLC is strictly an e-commerce platform, specializing in Bad Boy Mowers parts and accessories. However, over the next eight years, it grew into a multi-faceted business that includes retail, service and e-commerce.
Southern Outdoor Power has enjoyed great success since its launch, becoming the largest parts and accessories retailer for Bad Boy Mowers in the United States. "As my e-commerce business grew," said Micah, "I noticed an opportunity to expand my business locally." The north side of Monroe, Louisiana and the town of Sterlington have seen tremendous population growth in the last several years. Micah noticed this area had very little in the way of full service dealerships for outdoor power equipment, and he recognized this as a chance to expand his business. "I took the opportunity to build something new," said Micah, "and apply locally the lessons I learned in e-commerce."
Micah then took steps to open his new retail store, Yard Power. He chose to build his new store, rather than lease or buy an existing structure, for two reasons. The suitable buildings available for purchase in the location he wanted were very limited, but something more important compelled him to build. As a licensed Civil Engineer, Micah really wanted something he designed himself. "I really wanted to apply what I know about land development to make my store space efficient," he said. "This is very difficult to do without a clean slate."
Micah said designing his own building was the best decision he ever made. However, he had no experience with commercial loans. "I relied on my local banker to guide me in the process," he said. He knew that he would need an SBA loan, and his local banker has a great relationship with Community Business Finance. "My banker's previous dealings with Community Business Finance opened the door to work with them, and together they proposed the 504 Loan," said Micah.
Throughout the loan process everyone worked together as a team to get the deal completed in a timely manner. "Community Business Finance helped move the process along as quickly as possible," said Micah. "We worked well together."
The 504 Loan allowed him to build exactly what he wanted. There were several design elements he would not have been able to afford without the loan. In addition, he was able to finance the soft costs with the loan proceeds, and these savings allowed his new store to have what it needed right away.
"My store is so much more efficient than it would have been if I had not constructed it," said Micah. "My energy bills are very low because I was able to go with all LED fixtures and premium insulation." This added efficiency creates lower operating costs and increased profits.
While his e-commerce business is still thriving, the new retail building allows the company to offer the full service dealership that the area was lacking, as well as build equity while enjoying the tax savings of property ownership.