Kiran Vuriti co-owned and operated four locations of the franchise, Safari Kid, with her partner, Chandra Sirapu. Since it’s not easy to find rental space ready to accommodate a preschool, their locations were all within retail centers and had no outdoor space, thus putting limitations on the programs they could offer families. That is why when they decided to expand again – they chose to build the facility themselves.
Vuriti and Sirapu purchased land located at 2500 Positano Parkway in Dublin, CA and constructed a 15,000 square foot preschool facility, complete with a spacious outdoor play area. They utilized the SBA 504 Program to complete the $7.7 million project with only a 10 percent down payment and a long-term, below-market rate.
“We had a hard time finding a lender,” stated Vuriti. “Banks were not interested in financing a construction project of this size for a school. However, after learning about the SBA 504 Program and obtaining the pre-approval letter from TMC Financing, we had the confidence to proceed.”
Kurt Chambliss, executive vice president administered the 504 loan on behalf of TMC Financing.
“The SBA 504 loan was ideal for this project,” explained Chambliss. “Banks are more willing to lend when the 504 Program is involved because of the more favorable loan to value ratio.
“Not only could they finance the land purchase, but they were also able to roll in the construction costs, the equipment and installation costs, and construction contingencies into the total project cost. A ten percent down payment for a project of this depth is unheard of if you are seeking conventional financing.”
Safari Kid is an international chain of preschools and after school programs, founded in the heart of Silicon Valley, California. In about fifteen years, 35,000 children from the program have shown consistent excellence in elementary and middle schools.
With their leased facilities, they were limited to only part time programs due to state restrictions requiring a certain amount of outdoor area for the children to play. With this newly built facility, Safari Kid can increase their capacity and offer full time care, and in turn increase their revenue streams.
“It feels absolutely wonderful to own our own building,” says Vuriti. “The building is beautiful and we can now operate how we want to– accommodating more age groups and more need. We are proud.”
About TMC Financing
Founded in 1981, TMC Financing is the No. 1 provider of SBA 504 commercial real estate financing in the Western Region of the U.S.. The company has funded projects worth over $10 billion across California, Nevada and Arizona. Approximately 6,000 businesses have benefited from this financing, resulting in the creation of an estimated 60,000 jobs.