Beauty Salon Feasibility Study in the Denver-Aurora-Centennial, CO Metro Area

Denver salons that borrow above the national pattern

Denver-area beauty salons borrow heavily for the class. A $150,000 median is 1.50x what salons borrow at the median nationwide, and the quartiles are $50,000 and $350,000. SBA approved 157 loans in FY2017 to FY2026, $50.9 million gross, 12 of 546 nationally and 6 of 39 among Denver classes, with a location quotient of 1.22x. Denver County has 55 loans, Jefferson 34, Arapahoe 28, Douglas 21, Adams 12 and Broomfield 7.

By program, 149 loans carry the 7(a) label and 8 the 504 label. The franchise share is 11.5%. At a median that high, a salon request in this market usually means a larger space, multiple stations, a suite model or an acquisition, not a single chair, and the study should say which. Revenue per station and the split between commission and booth rent decide whether a $150,000 loan can be repaid.

Holders

Bank holders: U.S. Bank, National Association (26 loans, $2.2 million); Wells Fargo Bank National Association ($3.2 million across 12 loans); Northeast Bank (ME) (8 loans, $817,600); BMO Bank National Association (7 loans, $3.0 million); JPMorgan Chase Bank, National Association (7 loans, $558,000). Note the presence of a Maine bank in a Colorado table: SBA records show where a lender holds loans, not where its branches are. As with every holder table, the entries describe a book and not a policy.

Outcome floors

Cancelled approvals run no lower than 13.8%. Withheld for Denver beauty salons: the ceiling, the charge-off rate and yearly counts; none is zero, and none is estimated here.

Denver County has 55 loans and Jefferson 34, while Broomfield has 7, so a salon in the outer counties draws on a much thinner lending record than one in the city. Arapahoe has 28 loans, Douglas 21 and Adams 12. A study should say which of those trade areas the project belongs to, because rents, parking and the pool of stylists differ between them, and it should not assume that the area average of $150,000 fits a neighborhood suite.

A study for a Denver salon should test the stylist pipeline and retention, rent per square foot in the chosen corridor, the competing salons in the trade area, state licensing, and the coverage ratio on a $150,000 request. Of the 157 salon loans, those from Denver, Jefferson, Arapahoe, Douglas, Adams and Broomfield qualify because OMB's delineation of July 2023 includes each county; a salon failing that test joins no metro, so 157 is a minimum.