Earlier this week the Small Business Administration and U.S. Treasury Department released a list of recipients from the government’s Paycheck Protection Program (PPP), which so far has allocated $521 billion of the $670 billion approved by Congress under the CARES Act to nearly 659,000 borrowers. The Trump Administration claims that this program has supported 51 million jobs, roughly 84% of whom work for small businesses.
At presstime, SBA hadn't released exactly how much each entity was approved to borrow. And some recipients—like retail and fast-food chains, millionaire rock bands, and a business venture led by NFL quarterback Tom Brady, who earned $23 million last year—have raised questions about the program’s purpose and vetting process.
But according to Lendio, a small business marketplace, construction led all industries in total volume among the 100,000 PPP loans totaling $8 billion that Lendio facilitated in partnership with 300 lenders between April 3 and June 30.
FIRST LOAN ROUND LEFT SMALL BUSINESSES STRANDED
The PPP program allowed businesses in many sectors to keep their workers employed even if they were shut down by the coronavirus.
Lendio and its partners tapped into the $350 billion in relief lending that Congress approved in early May, which went primarily to small businesses and small proprietorships.
When Congress approved the first round of PPP loans, its intention was to provide a life raft to businesses forced to close because of the coronavirus pandemic. Borrowers could receive up to 2.5 times their companies’ monthly payrolls, much of which would be forgiven if they keep their workers employed.
However, small businesses struggled to access the first round of PPP loans, totaling $349 billion, which lasted only two weeks and was gobbled up by relatively few businesses. For the second round, Congress earmarked $30 billion specifically for community banks so they wouldn’t have to compete with larger lenders.
The demand was certainly pressing. Lendio points out that prior to participating in the PPP, it had facilitated $2 billion in business loans since its inception in 2011.
The average PPP loan on the Lendio platform is $73,000, versus the national average of $107,000. During the PPP, 30% of the loans that Lendio facilitated went to businesses in urban areas, 28% in the suburbs, and 39% in rural communities. The Pacific and South Atlantic regions of the country accounted for 45% of Lendio’s PPP loans.
LENDIO FACILITATES $182 MILLION IN LOANS TO CONSTRUCTION BORROWERS
About 45% of the PPP loans that Lendio facilitated were to businesses in the Pacific and South Atlantic regions of the U.S.
Of the loans facilitated by Lendio, just under $181.7 million went to businesses in the construction industry, the highest total volume for any sector. Construction was followed by healthcare, restaurants, information media, manufacturing, and retail.
The average loan for construction borrowers was just under $100,000, which ranked fourth by sector, with manufacturing topping this list at $145,568 per loan average.
Lendio estimates that construction borrowers saved 17,500 jobs as a result of the PPP, behind restaurants (31,501 jobs saved), healthcare, and automotive.
ARE MORE LOANS IMMINENT?
Right now, Congress and the White House are debating whether more stimulus is needed, as the coronavirus continues to spread in several areas of the country, with nearly 3.1 confirmed cases of COVID-19 and 133,000 deaths in the U.S., and with hospitalizations rising in 22 states. Some states, cities and towns are reconsidering their plans for reopening their economies.
“Unfortunately, the challenges for small business owners do not end when they receive a PPP loan and great economic uncertainty remains,” writes Lendio. It notes that business owners are now navigating the loan forgiveness process, and others continue to seek financial assistance while operating on thin margins. “As demonstrated throughout the program to date, the need for relief funding is unprecedented and will likely continue as small business owners seek to reopen and rebuild in the coming months.”
Related Stories
| Jul 18, 2013
Top Government Sector Construction Firms [2013 Giants 300 Report]
Clark Group, Turner, PCL head Building Design+Construction's 2013 ranking of the largest government sector contractors and construction management firms in the U.S.
| Jul 18, 2013
Top Government Sector Engineering Firms [2013 Giants 300 Report]
Fluor, URS, AECOM top Building Design+Construction's 2013 ranking of the largest government sector engineering and engineering/architecture firms in the U.S.
| Jul 18, 2013
Top Government Sector Architecture Firms [2013 Giants 300 Report]
Stantec, HOK, HDR top Building Design+Construction's 2013 ranking of the largest government sector architecture and architecture/engineering firms in the U.S.
| Jul 18, 2013
LEGO takes on the iconic Sydney Opera House
This September, LEGO will expand its LEGO Creator Expert series with a 2,989-brick model of the iconic Sydney Opera House.
| Jul 17, 2013
Top Multifamily Construction Firms [2013 Giants 300 Report]
Lend Lease, Clark Group, Balfour Beatty top Building Design+Construction's 2013 ranking of the largest multifamily contractors and construction management firms in the United States.
| Jul 17, 2013
Top Multifamily Engineering Firms [2013 Giants 300 Report]
STV, URS, AECOM top Building Design+Construction's 2013 ranking of the largest multifamily engineering and engineering/architecture firms in the United States.
| Jul 17, 2013
Top Multifamily Architecture Firms [2013 Giants 300 Report]
IBI Group, Niles Bolton, Perkins Eastman top Building Design+Construction's 2013 ranking of the largest multifamily architecture and architecture/engineering firms in the United States.
| Jul 17, 2013
McLaughlin named Executive Director of the Builders Association
The Executive Committee of the Builders Association welcomes Dan McLaughlin as the new Executive Director. Dan comes to the Builders Association after twenty one years as the Executive Director of the Plumbing Contractors Association Of Chicago.
| Jul 17, 2013
CBRE recognizes nation's best green research projects
A rating system for comparative tenant energy use and a detailed evaluation of Energy Star energy management strategies are among the green research projects to be honored by commercial real estate giant CBRE Group.
| Jul 17, 2013
Retail store openings at five-year high
Analysis by RBC Capital Markets shows that U.S. retailers are planning to open 42,757 stores over the next 12 months, and some 83,700 locations over the next two years, both five-year highs.
