IMO your processor is incorrect. CRA reporting is driven by call reporting. If the loan is classified as a small business loan, presumably tying to 4a of the RC-C, and the loan is for renovations/improvements to improve rental properties or improve and sell I would consider it a small business loan. (assuming under $1MM and not to a non-profit)
_________________________
The opinions expressed are mine, do not represent the opinions of my employer, and they are not to be taken as legal advice.