Auto Repair Shop Feasibility Study in Florida

Florida saw 637 SBA approvals for car and truck mechanical repair between FY2017 and FY2026, worth $327.5 million gross. That count puts the state 3 of 51 for the class, yet the location quotient is 0.78x: repair shops weigh less in Florida's SBA book than in the national one, and the class sits 6 of 39 among Florida's classes. Size is not the difference: the median loan of $250,000 comes to 1.06x the national median for repair shops, with the central half of loans between $100,000 and $667,000.

A loss floor that lenders have to price

The loss record deserves a close look. Of the 245 loans disbursed in FY2017 to FY2021, 10.2% have been charged off so far, and 7.3% went bad inside five years of approval. Neither figure is final, since open loans can still fail. Cancellation is quieter: 14.7% of FY2017 to FY2024 approvals were cancelled, or 15.3% once loans still undisbursed count as cancelled.

Two kinds of repair shop loan in one state

SBA 7(a) carries most of the book, with 547 loans against 90 under SBA 504. Within 7(a) the holders differ widely in size of book. TD Bank, National Association holds 111 loans for $11.0 million and Newtek Bank, National Association 50 loans for $11.9 million. Live Oak Banking Company holds only 27 loans but $45.9 million. On the 504 side, Florida Business Development Corporation (40 loans, $20.2 million) edges out Florida First Capital Finance Corporation, Inc. (37 loans, $21.4 million). Franchise loans are 11.0% of the count, so most borrowers are independent operators. Approvals ran from 44 to 63 a year through FY2023, climbed to 82 in FY2024 and 102 in FY2025, then eased to 59 in FY2026. Miami-Dade (69 loans), Broward (63) and Hillsborough (51) lead the counties.

What a Florida repair shop study must test

A feasibility study here should start from that charge-off floor. On demand, it has to show how many bays the trade area can keep busy against the shops already serving it. On cost, lifts, diagnostic equipment and building work need separate budgets, since the spread between a $100,000 loan and a $667,000 one is often the real estate. Coverage of debt service belongs on slow opening years rather than a stabilized one, given the 7.3% charged off within five years. Where a 504 loan buys the building, the appraisal must value a special purpose garage at what another operator would pay for it.

One limit on the record: the borrower chose the industry code, and it files truck repair with car repair. Collision work, auto glass, oil change outlets and general automotive repair carry different codes and fall outside this class, so a project that adds a collision bay or a quick lube lane is only partly described by these numbers.