Loans & Guarantees
MassDevelopment specializes in financing complex projects that require experience and innovative thinking. Our low rates and flexible terms help foster real estate and business projects that generate economic benefits for local communities and the state as a whole. Plus they help you grow your operations and stay competitive in your field.
MassDevelopment administers the Brownfields Redevelopment Fund, which helps to transform vacant, abandoned, or underutilized industrial or commercial properties. In most cases, redevelopment is complicated by real or perceived environmental contamination and liability.
Types of Redevelopment Fund Programs:
- The Brownfields Site Assessment Program provides unsecured, interest-free financing up to $100,000 for environmental assessment of brownfields.
- The Brownfields Remediation Loan Program offers flexible loans up to $500,000 for environmental cleanup of brownfields.
Prior to redevelopment, MassDevelopment can provide a real estate loan or tax-exempt bond to finance your project.
Other state brownfields programs that provide financing incentives include:
- Brownfields Redevelopment Access to Capital Program (BRAC) - BRAC is administered by the Business Development Corporation of New England and offers low-cost, often state-subsidized, environmental insurance to help mitigate risk associated with brownfields redevelopment.
- Brownfields Tax Credit Program - The tax credit program is administered by the Massachusetts Department of Revenue and offers eligible businesses and nonprofits a tax credit for the costs incurred to remediate contaminated property owned or leased for business purposes and located in an economically distressed area. Tax credits may be used against state tax liabilities, or transferred or sold to third parties.
Through the Massachusetts Charter School Loan Guarantee Fund, MassDevelopment provides guarantees for bank loans or tax-exempt bonds financing the acquisition, construction, or renovation of charter school facilities located in Massachusetts.
For facilities owned by the school:
- Loan guarantees cover a percentage of the first mortgage loan up to the lesser of 50% or $3 million.
- Loan advance rate may be up to 100% of the property value.
For facilities leased by the school:
- Loan guarantees cover up to the lesser of $1,000,000 or 90% of the cost of facility improvements.
The Massachusetts Emerging Technology Fund (ETF) provides start-up or emerging technology companies with financing for working capital, manufacturing facilities, and equipment.
The ETF offers:
- Loans or loan participations up to $2,500,000
- Loan guarantees up to $1,500,000
To qualify for ETF financing, you must be a technology company starting or expanding manufacturing operations in Massachusetts, and have strong management teams, demonstrated technical feasibility, market demand for your products, and a proven fundraising record. Additionally:
- Financing must be for the purchase, expansion or improvement of real estate, working capital, and/or the purchase of equipment
- There must be at least two other parties at risk
- Financial investment must benefit the Massachusetts economy
Bridge Loans to Federal Grants
The ETF also offers loans to bridge the receipt of federal grants by advanced manufacturing companies:
- Loans of up to $500,000
- Payable in full upon receipt of federal grant
- Deferred and accrued interest due at maturity
If your company is expanding operations and needs to purchase equipment, MassDevelopment can help.
Our equipment loan program offers:
- Loans or bank loan participations up to $2,000,000
- Fixed rate financing
- Loan terms up to seven years
- Loan advance rates up to 85% of the cost of new equipment
- Exporters may receive 100% financing for new equipment
MassDevelopment offers the following programs to help companies that export or anticipate exporting products or services internationally:
- 100% Export Loan
- 100% financing for new equipment, leasehold improvements and working capital
- Loans up to $2,000,000
- Interest-only payments for the first 12 months
- Up to 7-year term and amortization
Export Loan Guarantees
- Loan guarantees on working capital lines of credit and other eligible loans
- Inventory and accounts receivable accepted as collateral
- Up to 70% working capital financing available
Other international trade resources available to exporters:
- Massachusetts Export Center - One-on-one export counseling and technical assistance, export workshops, and other services. www.mass.gov/export
- Massachusetts Office of International Trade and Investment - Works to expand the Massachusetts economy by marketing the state’s business internationally. www.mass.gov/moiti
- Massachusetts Export Resource Center - A one-stop resource for information and training to help businesses grow by taking advantage of global opportunities. www.mass.gov/export/resourcecenter
MassDevelopment can provide a guarantee on a portion of a bank real estate loan or tax-exempt bond. Our guarantee covers the difference between a bank’s maximum allowable loan advance rate and up to 90% of the property value, thereby increasing the amount of financing available to your business.
Our mortgage insurance guarantee program offers:
- Loan guarantees up to $2,000,000
- Loan advance rates up to 90% of the value of the real estate
Guarantees are also available for charter school loans, tax-exempt bonds, loans to companies that export products to international markets, and working capital loans to manufacturers.
Predevelopment loans can be used to finance early stage project costs, such as architectural and engineering work or traffic and feasibility studies necessary to advance a project to the construction stage. Our predevelopment loan program offers loans up to $100,000 and deferred interest payments.*
*Borrowers are required to provide a 50% match for MassDevelopment loan funds.
Real estate loans can be used to fund facility acquisition, renovation, construction, and permanent financing.
Our real estate loan program offers:
- Loans or bank loan participations up to $7,500,000
- Construction loans, usually made in partnership with another lender
- Permanent financing loans
- Multi-tenant, mixed use, commercial, industrial
- Manufacturers, small business, nonprofits
- Rental housing apartment buildings
- For owner-occupied real estate, loan advance rates up to 90% of the property value
MassDevelopment offers loans from $25,000 to $250,000 to help nonprofit 501(c)(3) organizations located in Massachusetts purchase and install technology equipment. 100% of cost of purchase of new or used telecommunications and information technology equipment, software, and related installation costs
Working Capital Loan Guaranty for Manufacturers
Our newest guaranty product allows banks to make larger working capital loans to manufacturing companies by providing a guaranty of up to 25% of the amount outstanding on a revolving line of credit. The guaranty terminates with the maturity of the line of credit and will be considered for renewal on the same cycle as the bank, but no less frequently than every three years.
Term working capital loans may also be guaranteed in a fixed amount equal to no more than 25% of the bank’s loan amount. The guarantee amortizes dollar for dollar with the underlying term loan for up to five years. MassDevelopment charges an annual fee equal to 1% of the guaranty amount as long as the guaranty is outstanding.
Manufacturing Planning Loans
MassDevelopment provides Manufacturing Planning Loans up to $50,000 with low interest rates and terms of up to five years. Loans can be used by manufacturing companies to pay for consultant services. Eligible consultant contracts include services to evaluate and improve demand (sales and marketing), fulfillment (operations improvement), and finance and administration (strategic leadership).