Brewery, Winery and Distillery Feasibility Study in Oregon

Oregon's producers far outweigh their national share

Beverage production weighs on Oregon's SBA lending far beyond its national weight. Its location quotient for breweries, wineries and distilleries is 1.88x, meaning Oregon gives the class a much bigger slice of its SBA loans than the nation does, and it ranks 8 of 39 classes inside the state. Oregon stands 13 of 53 among states, with 111 approvals worth $62.3 million from FY2017 to FY2026. Oregon's producer median and both of its outcome rates fail our distinctness screen, since none of them sits apart from both the Oregon all-asset record and the national class by our margin. Its mark is concentration.

The spread of loan sizes is unusually wide. The median Oregon producer loan was $250,000, or 0.86x the national median, but the middle half stretches from $50,000 to $895,250, so a small equipment or working-capital loan and a production facility purchase both appear in the record. SBA 7(a) carried 102 approvals and SBA 504 only 9, and franchising is absent at 0.00%. Columbia Bank dominates with 27 loans worth $6.9 million. Live Oak Banking Company holds only 7, yet they total $9.5 million, the largest dollar book here; Wells Fargo Bank National Association also holds 7, and First Interstate Bank and Banner Bank 6 each. Multnomah County leads with 32 approvals, Clackamas follows with 13 and Yamhill with 12, ahead of Lane, Deschutes and Polk. FY2017 was the busiest year with 19 loans for $9.5 million, and FY2022 brought $10.4 million on 13.

A clean loss record so far

Oregon cancelled at least 11.3% of its FY2017 to FY2024 producer approvals, a figure that rises to 12.4% when Oregon loans still waiting to disburse count as cancelled. Losses have been absent: the charge-off rate for the 58 Oregon loans disbursed in FY2017 to FY2021 is 0.00% to date, and inside five years of approval Oregon also shows 0.00%. That is a floor, not a promise, because those loans are still open.

What an Oregon producer study must prove

A clean Oregon loss history does not remove the risk in a new project. A feasibility study for an Oregon brewery, winery or distillery has to test demand for the product in its distribution channels and, separately, for any tasting room or taproom traffic, which differs sharply between a Portland county and a rural one. Cost testing has to cover tanks, barrels, bottling and the building, and for wineries the vineyard and the years before a vintage can be sold. Debt service coverage must allow for inventory that ages before it earns. A loan near $895,250 calls for an appraisal that values the production property honestly, since specialised buildings have few buyers.

On the data: the Oregon records identify a producer of beer, wine or spirits, but not whether an Oregon site also runs a taproom, tasting room or events, and wineries sit inside this class.