Lender Q&A: 504 Occupancy Requirements
Question: How long does a business have to meet 504 occupancy requirements?
Answer by Tom McHale, Senior Vice President
"Often times a small business will purchase an existing building with tenants that have lease agreements that expire after the buyer takes possession of the building. For existing buildings, SBA requires that the Operating Company occupy at least 51% of the space. However SBA allows the OC up to 12 months after the 504 loan closing to meet the occupancy requirements assuming the circumstances justify."