Question 1

What kind of Midland-Odessa business is SBA financing usually a fit for?

Accepted Answer

Oilfield services, logistics, and hospitality operators buying the real estate their business runs from. We do not have published local 7(a) or 504 volumes for this metro, so that is a borrower-profile read, not a count. The Midland MSA posted 2.9% unemployment in April 2026, the lowest in Texas against a 4.0% statewide average, on a labor force built around the Permian Basin. Diamondback Energy, the largest pure-play independent operator in the Permian, is headquartered in Midland. When a service company, trucking outfit, or hotel operator has outgrown a lease, SBA financing on the building is the natural next step. See the SBA program page for terms.

Question 2

I'm putting up a new shop or yard instead of buying an existing building. Does the occupancy rule change?

Accepted Answer

Yes, new construction has a higher bar than an existing building. Under 13 CFR 120.131, your business must occupy at least 51% of an existing building, but for new construction the floor is 60%, and no more than 20% of the project may be permanently leased to others, with a plan to absorb the remaining space over 3 to 10 years. If you're building rather than buying, in a growth corridor like southeast Midland County near Greenwood, plan the space around that math from the start. Midland's own published targets for commercial new-building permit review run about 20 business days, which is worth building into your construction timeline.

Question 3

My business would be the only tenant in the building. Does that change my down payment on a 504?

Accepted Answer

It can push your required contribution from 10% to 15% or 20%. Under 13 CFR 120.910, a 504 borrower puts in 10% of the project ordinarily, 15% if the business has been operating less than 2 years or the building is single-purpose, and 20% if both apply. Oilfield service yards, wash bays, and specialized shop buildings are exactly the kind of property that gets looked at under the single-purpose test, and the SBA lender makes that call on your specific building, so budget for the higher contribution rather than assuming a flat 10% down.

Question 4

Does it matter whether I buy my building in Midland or Odessa for the tax bill?

Accepted Answer

It's a real difference, and it runs the opposite direction of home prices. A City of Midland/Midland ISD parcel stacks to roughly 1.47% of value in combined 2025 property tax rates, while the four sourced Ector County/Odessa taxing units alone stack past 2.09%, before the hospital district. On a $300,000 building that's a swing of roughly $1,900 or more a year, money that comes straight off your operating income. Talk to your CPA about how that fits your numbers before you pick a side of the metro.

Question 5

What are 504 rates running right now, and is it true SBA fees are waived?

Accepted Answer

No, don't count on waived fees, and here are the numbers as of August 2026. 504 effective debenture rates were 6.272% on a 25-year term and 6.274% on a 20-year term, all-in including CDC, SBA, and CSA fees. SBA fees were reinstated for FY2026 on loans approved between October 1, 2025 and September 30, 2026: 7(a) upfront fees run 2% to 3.5%-plus depending on loan size, and 504 upfront fees run 0.50%, with the annual fee cut to 0.209%. Rates and fees move; get a current quote before you underwrite a deal on these numbers.

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