Duluth 1200 Fund

Duluth 1200 Fund is sponsored by City of Duluth. The Duluth 1200 Fund provides incentive, expansion support, childcare, and startup loan options for businesses in multiple phases of growth within the City of Duluth. Loans are intended to address a gap in the financial package necessary to complete a project.

The Duluth 1200 Fund provides incentive loans for business expansions and relocations within the City of Duluth, which will create new jobs. Loans will be made to eligible businesses to create the inducement necessary to structure financial packages to support business growth.

A loan from the Duluth 1200 Fund is intended to address a gap in the financial package, not replace business owner equity contributions or traditional bank lending. Our Mission is to foster the long term vitality and diversity of Duluth’s economy by providing sustainable and responsive gap financing and funding options that empower local businesses to start, grow and thrive. Are you curious about the name 1200 Fund?

Do you want to learn more about the Duluth 1200 Fund’s history and what businesses they have assisted? Check out this historical timeline! The 1200 Fund provides incentive, expansion support, childcare, and startup loan options for businesses in multiple phases of growth within the City of Duluth.

With the funding provided, businesses create new jobs, childcare availability, and the ability to bring a business's continued success. Loans from the Duluth 1200 Fund are intended to address a gap in the financial package necessary to complete a project, not replace business owner equity contributions or traditional bank lending.

Be sure to have all of the requested documents ready to upload into your application; the application window will time out, and you may need to start the process over again. Build Forward Duluth Loan Program The Build Forward Duluth Loan Program provides gap financing for Duluth businesses and childcare centers city-wide.

Loans must be utilized to purchase and make improvements in existing real estate buildings that will house the new business. Loan amount: maximum of $100,000 Term of loan: Up to 17 years Other special requirements: Provides funding for purchases, expansions for owned buildings, including equipment expenses to sustain the business.

As a gap financing program, another financial institution will be required to match or exceed the amount requested from this program in addition to owner equity. Loan forgiveness: Up to 50% of the loan principle may be forgiven after two years of the jobs that have been created have also remained available for the public. Quarterly job reporting will need to be completed to remain eligible for forgiveness .

This loan is created to assist small businesses with their start-up needs. This is done by developing a business mentor relationship that ensures loan requests are developed with enough support to thrive.

The Mentorship Loan can help businesses fund critical projects, and to build business credit and payment history, which is critical when seeking larger investments in the future, while connecting business owners to local mentors and business development specialists.

Loan amount: $ 3,000 - $15,000 Term of loan: 5 - 10 Years, based on the loan amount Other special requirements: Applicants must have, within the past 6 months, conducted a business consultation with the Small Business Development Center (SBDC) in Duluth. The applicant is required to be working with a business mentor.

Childcare Collaboration Grant Program The Childcare Collaboration Grant provides gap financing for licensed Duluth childcare providers who are starting up or expanding within Duluth city limits. Loan amount: Grant requests may not exceed $100,000. Other special requirements: The 1200 Fund's assistance shall not exceed 25% of the total.

Historic Fund Loan Program The Historic Fund loan program's application period is currently closed, and is expected to re-open in early 2027. The primary purpose of the Historic Fund is to support and encourage the vitality of and reinvestment in the Duluth Commercial Historic District through preservation, improvement, restoration, and rehabilitation.

Projects eligible for financial assistance include hard costs that improve the general appearance of a building’s exterior and interior, as well as commercial upgrades. Loan amount: $75,000 - $100,000 Buildings located outside of the priority area of East First Street are eligible for forgivable loans up to $75,000. 25% off the loan principle may be forgiven after 5 years if the criteria is met.

Buildings located on East First Street are eligible for forgivable loans up to $100,000. 50% off the loan principle may be forgiven after 5 years if the criteria is met. Term of loan: 17 Year term Other special requirements: Building owners of contributing structures to the Downtown Historical Commercial District are encouraged to apply for funding to update building renovations.

Soft costs, such as the cost of project planning and consultant deliverables, will be considered part of the applicant’s personal 10% match towards the requested funding. Residential tenant improvements are not eligible costs under this program. Map Containing Eligible Boundaries: PLEASE NOTE- Only buildings indicated in green with a green star are eligible for this program.

If a building is not green and does not have a green star, this funding is not applicable. Applications are currently closed; the second round of applications is expected to open in the fall of 2026. The primary purpose of the Storefront Loan Program is to encourage the reinvestment in designated Duluth neighborhood centers.

Reinvestment is defined in this loan program as the restoration of historic atmosphere, overall visual improvement of building facades to strengthen neighborhoods, and enhancement of community viability within Spirit Valley and Downtown Duluth. Loan amount: Storefront loans within each identified area are eligible for loans up to $100,000 at a fixed 4% interest rate at a term of 17 years.

Eligible uses for funding include: Projects eligible for financial assistance include hard costs that improve the general appearance of a public facing building exterior.

Exterior renovations may include signage, awnings, window and door replacement, lighting, foundation repairs, tuckpointing, exterior painting, restoration of architectural elements, brick reconstruction, concrete work (outside of the city right of way), artistic murals and landscaping. The loan is not to be used for tenant improvements.

Loans will be collateralized by a mortgage on the building that is being improved with the loan proceeds. Other special requirements: Soft costs, such the cost of project planning and consultant deliverables will be considered part of the applicant’s personal 10% match towards the requested funding. Residential tenant improvements are not eligible costs under this program.

Map Containing Eligible Boundaries: List of eligible parcels for Spirit Valley List of eligible parcels for Downtown District If your business is located within the Duluth city limits and needs financial support to complete a project or expansion, the 1200 Fund has a loan option for you. When is the right time to apply for a 1200 Fund loan?

The ideal time to apply is after you’ve completed a preliminary financial review with your primary lender. Once your lender has identified any funding gaps in your project, that’s when it’s most appropriate to submit your application to the 1200 Fund. This ensures we’re supporting the portion of the financing that truly needs it—complementing your primary loan package effectively.

After determining the right loan program for your business needs, fill out a pre-application (available at the bottom of this webpage). A city of Duluth staff member will contact you within five business days requesting additional eligibility information. What will be required from borrowers for a loan review?

Please see this link to get a comprehensive list of required materials that will needed to determine full eligibility. These items will be requested later, after your application is submitted and initially reviewed. Why should I pursue a Duluth 1200 Fund loan?

The 1200 Fund board is comprised of area business leaders, skilled financial experts, business professionals and even past borrowers who believe in the non- profit’s objective to assist business and entrepreneurs. Loans are provided to fill the financial gap needed to take a project to completion, these programs can help businesses who need that final helping hand to advance their project.

Some of the programs offer loan-forgiveness if certain requirements are met. Northland Special Events dba Josephine's Bridal When I began planning for the build out for Josephine's Bridal, I knew I would need funding partners for the project. From the moment I reached out to the 1200 Fund to the project ribbon cutting, the 1200 exceeded my expectations.

The process for applying, the collaboration with my partnering lenders, and the clear communication and expectations made the loan experience easy and stress-free. The 1200 Fund worked behind the scenes with 2 other lenders to put together a funding package that met all of my needs and required a minimum amount of time and effort on my part - think one common portal for document uploads!

I loved meeting with the Board and presenting my plans, as it truly showed the community involvement of this organization. Members of the Board and staff made every effort to support the journey, including attending our grand opening and ribbon cutting. Duluth is incredibly blessed to have an organization like this to support small business and community economic development.

Mariah McKechnie, Josephine's Bridal The 1200 fund allowed the Duluth Pottery to grow by providing gap funding to put a roof on my new old building. Now we... our new team...

can grow and be a solid part of the Duluth Business and work community! Karin Kraemer, Duluth Pottery The effort that goes into restoring an old building is daunting. It takes more than just finances to start up a business.

It takes a team. Partnering with the city has given us the confidence to know we are all in this together. Restoring and rebuilding Lincoln Park's charm is a goal that we can all do better together.

Leveraging the costs is critical in keeping the financial well being in line so we can get past the hurdles and create a vibrant tax base for long term success. Tom Hanson, OMC Smokehouse 411 West 1st Street, Room 160 Emily Vikre (Vice-President) Terese Tomanek (Council Representative)