A loan from a Pittsburgh-area bank with a little help from the federal stimulus plan has helped a Blairsville man make a dream come true while creating several jobs for the area.
Since he was in high school, Scott Cavender has been interested in cooking and the restaurant business, and after working nearly 20 years in the real estate industry, he finally got his chance to indulge in those interests last June when he opened Hotel De Baca -- a Mexican restaurant, bar and hotel located at 188 E. Market St. in Blairsville.
In order to help with the acquisition of the property and to get the business started, Cavender and his wife Diana, who co-own Hotel De Baca, applied for and received a $150,000 small business loan from Enterprise Bank in Allison Park, near Pittsburgh, early last year.
The Cavenders had started working with the Small Business Administration to secure a loan more than a year ago. But it was initially difficult because of the economic recession, and local banks weren't interested in helping with financing because of the risk involved.
"It was the worst possible time you could try to acquire a commercial property because the economy was absolutely abysmal," Scott Cavender said. "All lenders view restaurants and bars as high-risk loans. When you have a restaurant, bar and hotel in the same entity -- in conjunction with the economy at the time -- no one wanted to look at it."
Around the time the Cavenders were looking to secure the loan, the federal government was also trying to find a way to jump-start the economy. The American Reinvestment and Recovery Act of 2009, also known as the federal stimulus, included a provision meant to make it easier for small businesses to receive loans through the Small Business Administration. The SBA received $730 million through ARRA.
Through the legislation, lenders were given more incentive to approve financing because the SBA increased its maximum guarantee on loans from 85 to 90 percent. Businesses were also helped because certain SBA funding fees were waived.
Early last year, everything came together for the Cavenders. A connection they had in the real estate industry alerted them to Enterprise Bank, which had extensive experience with the SBA loan program.
The bank agreed to the $150,000 loan to start the business, and an SBA funding fee of about $1,500 was waived because of the new lending program through the stimulus.
Although the $150,000 loan is connected to the stimulus, Scott Cavender emphasized that it is not a grant, noting that he and his wife still have to pay that money back. The $1,500 fee that was waived, Cavender said, was more than made up for by the four additional jobs -- not including he and his wife -- he brought to Blairsville by starting the business.
Cavender had a lot of praise for Enterprise Bank, and he said without the loan he received from the bank through the SBA, Hotel De Baca never would have opened its doors.
"I had the money that I had, and that was it," he said.
The loan allowed Cavender to finally take advantage of his love for cooking. He was born in El Paso, Texas, and had been interested in cooking since picking up skills in the kitchen from his mother and his Mexican grandmother. In fact, Cavender used his grandmother's family name, De Baca, for the name of the restaurant.
He spent the first 10 years of his life in Texas and New Mexico before moving to Indiana County in the 1970s. He graduated from United High School and was interested in attending culinary school, but his family convinced him to go to college instead.
After moving back to the Southwest for college, Cavender returned to Indiana County in the late 1980s, met his wife Diana, and began selling real estate.
When the property at 188 E. Market St. was up for sale a few years ago, Cavender decided it was time to make a change in his life.
"I actually listed this place, it was on the market for a while," Cavender said, "and I was talking to my wife and said 'I'm really tired of real estate, burnt out on it.' I talked her into this place, and we bought it."
Because Cavender said it would have been unethical for him to negotiate a lower price, he offered the previous owners the list price of $211,000.
It was a big step to take from real estate to the restaurant industry, but Cavender was confident the business could succeed.
"If it would've been just a restaurant, I would've been more concerned," Cavender said. "But, because there are basically three entities here -- there's the restaurant, there's the bar, and there's also a hotel -- that definitely helps as far as the cash flow goes. You don't have all of your eggs tied up in just one entity."
The restaurant and the bar are located next to each other on the first floor -- with a wall in between to conform to the state smoking law. The restaurant is non-smoking while smoking is permitted in the bar area. The hotel portion of the building is located on floors above the restaurant and bar.
Cavender said the food at the restaurant is authentic and hand-made. The enchiladas, he said, are a little different than what is found at other restaurants because they are flat instead of rolled. The tortillas are layered with ground beef, shredded lettuce, onion and a red enchilada sauce and topped with a fried egg.
"If you wanted to compare it to something, it would be like a Mexican lasagna," Cavender said. "People love them."
Hotel De Baca also offers a lot in the way of non-Mexican food, including the Baca burger, which is a 12-ounce made-to-order burger with bacon, cheddar, onions, sliced avocado, lettuce, tomato and green chilies.
In addition, the restaurant features a pizza pie of more than 30 inches that can be cut into 52 slices. That item must be ordered 24 hours in advance.
Offerings at the bar include 11 different draft beers as well as 18 types of tequila and 11 different vodkas. The bar often has a disc jockey on the weekends.
Hotel De Baca is open from 11 a.m. to midnight Monday through Thursday and from 11 a.m. to 2 a.m. Friday and Saturday. The kitchen is open from 11 a.m. to 9 p.m. Monday through Saturday. The establishment is closed Sunday.
"Eventually I would like to be known as the Luigi's of Blairsville, but on a Latino theme," Cavender said, referring to the popular Italian restaurant in Clymer. "I want to be able to have families come in and be comfortable as far as bringing in their kids (in the restaurant) and eating. I think as we have more time and are able to do more renovations, that will come to fruition."
