Newark Small Businesses Get Boost from New Fund

Big news for small businesses in Newark: As much as $400,000 in loans will be made available to city entrepreneurs, thanks to Brick City Development Corporation's new Newark Fund.

Small and minority businesses that may otherwise have a hard time obtaining capital to jumpstart their companies are eligible to apply for the loan, which will offer a starting interest rate of eight percent with a maximum term of five years. The loan, open to Newark-based for-profits, is designed to help support community-based businesses like dry cleaners, retail stores and coffee shops.

"Small businesses obviously create jobs for residents, they build wealth and, not only that, I think they're safe havens for communities," said Wayne T. Meyer, president of New Jersey Community Capital, the firm managing the fund. "They're really essential when we talk about rebuilding and stabilizing communities."

The loan, which joins a host of others offered by BCDC, can be used toward real estate acquisition, equipment, leasehold improvements, inventory and working capital.

The fund's $4 million total, capitalized by Prudential Financial's social investment group, is expected to be used in the next 24 months, said BCDC Chief Executive Officer Lyneir Richardson. He said the fund, if successful in its first round, will be replenished as time goes on.

Richardson said BCDC has already committed about $14 million in loans of $18 million in total capital to businesses in Newark, spurring what Mayor Cory Booker called the city's biggest economic development period since the 1950s.

"This is like adding $4 million to our powder keg," said Richardson, adding that he'd like to see that total number grow over time to $30 million. "I view this kind of capital as rocket fuel for small business growth."

India McMillion, owner of Karma Consignment on Halsey Street, said she plans on applying for the loan in hopes of boosting marketing and advertising for her three-year-old shop. The extra dough could help her attract out-of-town women to her shop.

"If I'm coming into Newark and I don't know that I can go to a boutique, I'm just going to stay in my hotel room," she said.

Those interested in applying for the loan should contact Ryan Johnson at johnsonr@bcdcnewark.org.