"What this really means to small chains or mom and pop facilities is that they can now access the same capital as Wall Street investors without the cost," says Clinton Lovell, president of Houston-based Rainmaker Underwriting.
"They can tap into a larger audience-beyond 'angel' investors or family and friends-and get the capital they need.
They can go into market with direct mail pieces or email blasts to reach potential investors."
As a result of this change, Lovell
says, "We will see more mom and pops entering the field and small chains growing faster.
It also will create a downward pressure on investment bankers who will have to be more competitive."
How to start?
Go through the usual due diligence, says Lovell
, including a feasibility study, negotiating architecture and construction contracts, acquiring a property management, securing civil engineering studies, and completing a detailed marketing plan.
"You want to have everything necessary to show that the deal is ready to go tomorrow.
Cost estimates and projections must be close to reality.
If it's an attractive deal, it will attract good offers," he
This could be a huge game changer for facilities, Lovell
"It has the potential to lock down costs and ensure more certain outcomes so that projects are attractive to early-stage investors."
At the same time, he
says, "You can get the money you need with favorable rates and still control the lion's share of the project's economics."