Anthony Page opened his first Sleepworks Mattress & Furniture in 2006 in Massapequa Park. The store was successful from the start, giving Page the money to pay down $1.2 million of a $1.75 million bank loan in less than five years. Then, his lender converted the $500,000 outstanding on that loan and a separate $250,000 loan that Page had accessed in 2011 to renovate the store, into a loan with a high rate of interest and extra fees until a balloon payment was satisfied.
"I knew I had to refinance," said Page, who does business as Easy Bed Mattress Co. Inc. He reached out to Wells Fargo Bank, which brought The 504 Company into the fold. The two partnered in a $1.043 million refinancing deal that allowed Page to pay off the $750,000 in high-interest debt and fund $293,000 in equipment and property upgrades.
The lower interest rate improved the company's cash flow and provided two expansion opportunities. As such, Page opened a second, smaller Sleepworks outlet in Bay Shore earlier this year. He will use a $3.5 million conventional SBA 504 loan to build his third and largest Sleepworks store, this one in Patchogue. All three Sleepworks stores are on Long Island. The expansions allow Page’s company to compete with Sleepy's and other large mattress retailers.
Sleepworks qualified for the refinancing through the Small Business Jobs Act's 504 Refinance Loan program. The program, administered through the SBA, allowed small businesses to lock in long-term, stable financing, with a goal of protecting jobs and hiring additional workers. The newest Sleepworks Mattress & Furniture store will create 20 new jobs. Sleepworks' two retail outlets currently employ four people.
Joseph D'Imperio, vice president at Wells Fargo Bank, said the bank quickly saw the value of the project to the bank and the mattress company. "When we can add a strong small business to our portfolio while at the same time improving the financial structure for that business, we consider that a win-win," D'Imperio said.
Page said he was particularly impressed with the knowledge and access to resources that both lenders made available to him. "The guys I worked with were outstanding. They knew their stuff. I don't think there was a time when I asked a question that they didn't know the answer. That's very unusual in today's world," he said.
SBA's Refinance Loan achieved two of the program's goals by freeing up money so Easy Bed could expand and create jobs, said Kevin O'Leary, vice president with The 504 Company.
"By providing access to capital when none was available, we helped the borrowers receive substantial interest-rate savings from a low-interest-rate product while creating four new jobs and as many as 20 future jobs," O'Leary said.
The Patchogue store will be built in two phases. The first phase will be 23,000 square feet; the second phase will be 41,000 square feet. Page plans to market it as "the world's largest mattress store." It is expected to open in early 2015.
Anthony Page, owner of Sleepworks Mattress and Furniture
NYBDC vice president, Kevin O'Leary, with Anthony Page