Car Wash Feasibility Study in Utah

Smaller tickets than the national car wash book

Utah's car wash lending is distinctive in one respect above the rest: the size of the loan. Between FY2017 and FY2026 SBA approved 84 loans for car washes in the state, with $83.0 million approved overall; the median loan came to $656,500. Measured against the nationwide car wash median, that works out at 0.71x. Utah sponsors are therefore borrowing noticeably less per site than car wash borrowers elsewhere, even though the state's share of loans sits at 1.19x the national share and ranks 13 of 53 among states. Within Utah, car washes rank 13 of 39 among asset classes. The middle half of approvals runs from $336,875 to $1.5 million, so a lender underwriting one of these requests should expect a wide spread around a modest centre rather than a cluster of very large tunnels.

Programs, lenders and the places the loans sit

The program split is close to even: 45 loans under SBA 7(a) and 39 under SBA 504. That balance is unusual for a class that often leans on one product, and it means real estate heavy projects are well represented. Mountain West Small Business Finance holds 30 of the 504 loans, with $27.4 million, and Intermountain Business Lending, Inc. holds 5. Under 7(a), no lender dominates; the named ones hold few loans each: America First Federal Credit Union with 8, then Zions Bancorporation, National Association and First Utah Bank with 5 apiece. Franchise affiliation is rare, at 2.4% of loans. Geography is concentrated along the Wasatch Front: Salt Lake County has 30 loans, Weber 13 and Davis 12, with Utah County at 8 and Cache at 6.

What the outcome floors say, and what they do not

Looking at FY2017 to FY2024 approvals, no fewer than 9.6% never reached closing, and treating undisbursed loans as cancelled leaves that 9.6% unchanged, so the figure is firm. For a borrower this is a reminder that roughly one approval in ten never closes, often because site control, permitting or equipment pricing moved. On charge-offs, the 45 disbursed loans from FY2017 through FY2021 have produced no charge-off so far, and the early five-year reading is also 0.00%. Both readings are floors from a modest group, and loans can still go bad, so they show discipline, not a guarantee. Approvals ran from 14 loans in FY2017 and 15 in FY2018 down to 3 in FY2025 before 8 in FY2026, which suggests few new competitors have been financed recently.

What a Utah feasibility study has to test

Because the code covers car and truck washes, including mobile washes, and truck washes sit under the same industry code, the loan count mixes formats that earn very differently. A study should first separate the proposed format from that blend. Then it must test demand at the specific trade area, since a state median says little about one corner in Salt Lake or Weber County. It must price the build or conversion against a typical loan well under the national median, check that debt service coverage holds at conservative wash volumes and weather seasons, and prepare the appraisal evidence a lender will need on land, building and equipment value. Loan Analytics publishes these figures so both sides can start from the same record.