The Southern Dallas Development Corporation (SDDC) was formed in 1989 as a
not-for-profit 501(c3) to leverage private debt and equity, promote access to capital,
facilitate job creation and foster economic development. SDDC makes loans directly or in
partnership with conventional banks through the loan funds that we support. Our small
business loan funds provide fixed-interest rate, term loans for permanent working capital,
machinery, equipment, commercial real estate acquisition and development. SDDC’s
boundaries and primary target markets are generally south of the Trinity River and I-30,
although we are authorized to make loans throughout The City of Dallas and the enterprise
zones.
Healthy businesses create jobs, brighten our commercial corridors, generate wealth and
empower the community. SDDC helps start and expand businesses in distressed
communities—a proven strategy in which we are proud to participate. Since inception,
SDDC has generated $55.0 million in direct loans and $101.5 million in bank/investor
dollars leveraged for a total investment of $156.5 million. SDDC has assisted almost 500
businesses and created over 4,000 jobs where they are needed most.
Access to capital is one of the most frequently cited obstacles to small and minority
business development, formation and expansion, particularly in the urban core. While the
restriction of capital and investments to an area can slowly suffocate and economically
stagnate a neighborhood, the promotion of investment, “green lining”, can contribute to a
neighborhood’s revitalization and prosperity. SDDC focuses on promotion of investment—
by reducing the risk of exposure a bank may have when reviewing loan requests with
inadequate collateral, marginal cash flow to service debt or borrowers with weak credit
histories. We accomplish this by subordinating our collateral position to the bank. SDDC is
willing to take slightly more risk to make a deal happen, particularly if it will impact the
community.
SDDC is a catalyst for small business growth and development because it is uniquely
structured to take on risks associated with lending in distressed markets. Public sector
entities and non-profit organizations like SDDC are critical to the development cycle
because they absorb the initial risk. The private sector requires strong incentives to initiate
projects that it perceives as high risk. Therefore, organizations like SDDC, as well as
public sector subsidies, are needed to revitalize our distressed communities. Once the risks
are abated, the private sector and conventional market forces will take over and drive the
development processes. During redevelopment, a phenomenon known as “gentrification” is
likely to occur. Gentrification is the restoration of deteriorated urban areas by the
middle-class, which often results in displacement of lower-income businesses and residents.
SDDC can help mitigate displacement by assuring that these businesses have access to
capital.
Today, SDDC operates several funds, the details of which can be found on our Loan
Programs page. If you would like to make a donation to support our efforts, you may
contact Charles McElrath at 214-948-7800.
