Assisted Living Feasibility Study in Utah

Utah leans on senior residences harder than most states

Utah's record for assisted living without nursing care is notable for volume relative to the state and for ticket size. Across FY2017 to FY2026, SBA approved 84 loans worth $138.1 million, which places Utah 9 of 50 among states, even though, set against Utah's own mix, the class is merely 13 of 39. With a location quotient of 1.61x, residences for seniors claim a far bigger slice of SBA activity in Utah than the national share. Typical size is large too: a median of $1.2 million, 1.55x what the class borrows at the national midpoint, with the interquartile band stretching from $476,500 up to $2.6 million. Borrowers in Utah are financing bigger buildings than operators elsewhere.

Program mix, lenders and the counties behind the volume

SBA 7(a) accounts for 55 of the loans and SBA 504 for 29, so real estate heavy deals financed through the debenture structure are a meaningful minority. Franchised operators make up 32.1% of loans, high enough that brand-affiliated senior living shows up in the Utah file. On the 504 side Mountain West Small Business Finance leads with 24 loans and $33.0 million. Among 7(a) lenders, Mountain America FCU has 19 loans worth $21.7 million, America First Federal Credit Union has 8 worth $18.7 million, and Live Oak Banking Company logs 5 worth $13.1 million. Salt Lake County records 31 loans, Utah County 16 and Davis County 14, while Washington and Weber counties have 5 each.

Cancellations, charge-offs and a thinner recent stretch

For approvals dated FY2017 through FY2024, the cancelled share is at least 16.2%, and treating loans still undisbursed as cancelled lifts that ceiling to 17.6%. Roughly one approval in six never funded as approved, so a Utah sponsor should regard a commitment as conditional until licensing, plans and equity are firm. Charge-offs read differently by horizon. Looking at the 50 loans whose money went out in FY2017 through FY2021, 6.0% show a charge-off so far, yet 0.00% went bad within five years of approval, which suggests trouble here arrives late if it arrives. Both are floors. Volume has also thinned: 19 loans and $23.7 million in FY2017 became 3 loans and $4.8 million in FY2022, before 13 loans and $14.7 million in FY2025.

Testing a Utah senior residence

Proving demand inside a realistic draw area, county by county, comes first, since lending concentrates so heavily along the Wasatch Front. Next comes construction or conversion cost, set against the larger tickets lenders in this state have accepted. Then the work shows debt service coverage once occupancy settles, after a fill period nobody has to strain to believe. The appraisal is the last gate: income and value conclusions have to agree, because a lender sizes the loan against what the appraiser can support.

A coding note limits what these figures cover. They describe homes without on-site nursing; memory care lacks any code, and homes that add nursing are filed with nursing facilities and continuing care, not here.