Commercial funding - small mortgage refi, with ownership transfer

[Russ B.]

Hi all,

I'm pretty new to commercial real estate in general (I've really only done residential stuff before), so I'm wondering if someone here might be able to make a suggestion, on who to reach out to for commercial financing?

My wife and I have a deal we've been working on for a couple years now, to take over a large daycare center. It's a long story, but we basically saved a very young business from dying in its first year, and took over the business side of management. It has been running strong for about two years now, and most of its startup debts are paid. 

A majority share in the business will transfer to us (per a contract that's literally as thick as a phone book - apologies in advance to anybody that has to review it... 😅) as soon as we meet the last condition - get the 190k debt on the building out of the outgoing owner's name. 

We would still have a couple years to do that before the balloon payment.. but there's a development of new condos about to open adjacent to our building, and we already have a waiting list a mile long. So, we are really interested in getting this refi / transfer done, so we can shift our focus to expanding. 

I'm not getting a whole lot of interest from regular lenders in financing this due to the low amount, and some that will go that small want all owners to have solid credit scores (my credit is excellent, but the remaining original partner went broke getting the place open, and still has poor credit as a result). 

I would really like to avoid having to do something like buy the building myself and rent it back, although I could if that was really the only option. I'm hoping we can keep it simpler than that - and avoid shifting the balance between the partners.

The business is doing very well, its gross revenue for 2019 will be more than double the note amount, and the LTV should easily be below 70%. Surely there must be some kind of lender out there somewhere that could do something with this?