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  Ask the Expert: RDCs are another financing option By STEPHEN HEAVENER Jun 2, 2019    The New Hampshire Alliance of Regional Development Corporations is a
Ask the Expert: RDCs are another financing option
Jun 2, 2019 
The New Hampshire Alliance of Regional Development Corporations is a consortium of 10 nonprofit economic development organizations established to support, enhance and promote economic development efforts and job creation specific to the individual needs of the various regions of the state. Members have access to resources to government funding sources, revolving loan pools and gap financing.
The creative financing programs managed by the RDCs may be an ideal resource to supplement traditional bank financing as companies sell to new owners or seek expansion capital. It is a tool that should be considered when businesses set up their success plans and plan for growth. RDCs have been successful in providing gap financing to owners selling to family members and external borrowers.
The RDCs typically provide debt financing, which requires some level of acceptable collateral to secure their loans. Because most loans are deployed in coordination with traditional bank financing, the RDCs generally accept a subordinate position to the bank’s first position on assets being financed. Because of this requirement for collateral, debt financing is generally not an ideal resource to fund startups or technology focused companies because of the nature of their assets. Most RDCs do not have the skill set to evaluate intellectual property, for example, as a collateral option. As companies evolve and reach income sustainability and seek traditional office leases or acquire real estate, working with a RDC may become a financing option.
Most RDCs work closely with banks to fill financing gaps with the goal of supplementing traditional commercial capital. They do not compete with banks but provide additional funds through flexible loans required to move a project to completion. RDCs have a higher risk tolerance than banks based on their nonprofit mission goals of job creation, tax base enhancement and redevelopment of impactful and high visibility buildings.
Businesses looking to obtain a Community Development Block Grant funding through the New Hampshire Community Development Finance Authority for an Economic Development loan to finance job creating expansions should work with their local RDC. The experienced RDC staff can guide a business through the process, including obtaining municipal approval for an application and terms for repayment.
The Capital Regional Development Corp., CRDC, is the RDC responsible for business and development lending throughout Sullivan, Merrimack and eight towns in Hillsborough County (Goffstown, Weare, New Boston, Bedford, Manchester, Mont Vernon, Amherst and Hollis).
CRDC manages small business and development loan funds capitalized by the U.S. Small Business Administration, U.S. Department of Agriculture, the U.S. Environmental Protection Agency and State of New Hampshire Tax Credit programs. CRDC currently maintains loan portfolios to nearly 150 New Hampshire businesses and developers with outstanding loans balances that exceed $35 million.
The following is a sample list of projects in the Manchester market that CRDC has injected some level of financing into: GYK Antler redevelopment of York Cigar Building in Manchester, New Morning Schools in Bedford, The Flats at Hanover Square mixed use commercial and residential redevelopment of the former Farnum Center Building, Manchester Music Mill, North End Montessori School in Manchester, Bunny’s Market expansion to downtown Manchester, Lambert Funeral Home succession to new owners and the redevelopment of the former Ted Hebert Music School into 30 apartments and commercial space.

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