Worked Example: Conventional Bank Marina Acquisition and Dock Expansion Feasibility Study in Kentucky

This is a worked example, not a client engagement. It takes a hypothetical full-service marina on Lake Cumberland, a U.S. Army Corps of Engineers reservoir in south-central Kentucky, and walks through how a feasibility study would test its purchase and a dock expansion against a conventional commercial bank loan: why the Corps lease, not the docks, is the collateral question, why the requested loan does not reach the bank's assumed coverage minimum, and which three items would decide the answer. Each project number is labelled as an assumption, while market facts, program rules and interest rates point to public sources; no marina, operator, lender or address is named.

At a glance. The acquisition of an existing marina leasehold on Lake Cumberland and the addition of new covered wet slips, financed by a regional bank on a ten-year fixed-rate loan with a 25-year amortization. At the assumed 90 percent wet slip occupancy and assumed rents the stabilized coverage is 1.17x, below the assumed 1.30x bank minimum; the loan that meets the minimum is $4,787,343, or 58.6% of cost (Table 7). Break-even wet slip occupancy is 79.9% at 1.00x and 97.5% at the assumed minimum (Table 9).

• Total project cost: $8,165,000
• Conventional bank loan (65% of cost): $5,307,250
• Borrower equity: $2,857,750
• Stabilized net operating income after reserves: $569,503
• Stabilized debt service coverage: 1.17x
• Wet slip occupancy at 1.00x coverage: 79.9%
• Wet slip occupancy needed for the 1.30x minimum: 97.5%

What a Feasibility Consultant Tests First on a Kentucky Marina Bank Loan

When a commercial bank lends on a marina, its own written policy governs, and the guidelines the FDIC codifies as Appendix A to Part 365 of its regulations set out what that policy should contain, as interagency real estate lending guidance. For development and construction projects and for completed commercial properties, the policy should call for feasibility studies and for sensitivity and risk testing, among them how far income projections move when interest rates, vacancy rates or operating expenses change ^[1]. It should also set minimum standards for net worth, cash flow and debt service coverage of the borrower or the underlying property ^[2]. The coverage figure is the bank's own; the 1.30x used here is an assumed minimum for one regional bank, not a regulatory number.

A marina on a Corps reservoir adds a question an apartment building does not raise. The land under the docks and the ship store belongs to the United States, and the operator holds it under a lease. Section 4 of the Flood Control Act of 1944 lets the Secretary of the Army grant leases of lands, including structures or facilities on them, at water resource development projects "for such periods, and upon such terms and for such purposes as he may deem reasonable in the public interest" ^[3]. It sets no lease term. A bank cannot amortize a loan past the day the borrower's right to occupy the shoreline ends, which makes the lease the opening test for the study: how many years remain, whether the Corps will consent to its assignment to the buyer and to the lender as collateral, and whether an extension can be a condition of closing. Here the remaining term after an assumed Corps-approved assignment and extension is an assumed 30 years, which leaves 20 years at loan maturity and 5 years after full amortization (Table 7).

The second test is coverage. Stabilized net operating income after a dock replacement reserve is $569,503 and annual debt service on the requested loan is $485,655, so coverage is 1.17x against the assumed 1.30x minimum (Table 7). The requested loan does not meet the minimum. Because a conventional loan has no program floor, the assumed 1.30x lender minimum is the binding minimum (Table 7). The loan that meets it is $4,787,343, which is 58.6% of total project cost, and the difference of $519,907 would have to come from the buyer as added equity or from the bank as a lower minimum (Table 7).

The third test is the rate. The base rate is the 10-year Treasury constant maturity yield, 4.86 percent on November 6, 2026, as published in the Fed's H.15 statistical release ^[4]; the model then adds an assumed 3.00 point spread for a seasonal specialty asset on a leasehold, giving a fixed rate of 7.86% (Table 7). The lender is a regional bank because, as Leisure Investment Properties Group's 2024 Marina Investment Report says, independent owners and operators of specialty assets such as marinas have traditionally relied on regional lenders for their debt financing ^[5]; a bank with a small allowance for specialty credits will hold the study to its policy minimum rather than stretch.

Decision. The study would open with the lease, because it sets the longest amortization the bank can lend on; it would then report that at the stated assumptions the requested loan covers 1.17x against an assumed 1.30x minimum, and would size the loan at $4,787,343 (Table 7) unless the rent roll proves more than the assumptions.

The Site and Its Market: Lake Cumberland and South-Central Kentucky

The marinas on Corps lakes are private businesses on public land: the House Oversight Committee chairman's March 28, 2024 statement, opening a field hearing in Kentucky, says the Corps imposes real estate administrative fees on those who use its managed real estate, including privately operated marinas on the lakes, such as Lake Cumberland ^[6].

The visitation record comes from two political statements nineteen years apart, and a consultant would present both with their dates. The chairman's 2024 statement says Lake Cumberland hosted over 2.5 million visitors in 2022 ^[7]. A May 15, 2007 House floor statement by a Kentucky member said Lake Cumberland was visited by more than 4.7 million people annually and, citing the Travel Industry Association of America, put the tourism impact for the four counties with lake access, Clinton, Pulaski, Russell and Wayne, at $152.6 million ^[8]. The two counts differ by source, method and year, and this example does not reconcile them.

The resident counts matter less here than for a grocery-anchored center, because the marina's slip holders are mostly boat owners who drive to the lake from elsewhere in Kentucky and neighboring states. The statewide frame is the better indicator. The Bureau of Economic Analysis puts Kentucky's boating and fishing value added at $285,520 thousand in 2024, inside total outdoor recreation value added of $6,360,454 thousand ^[14]; outdoor recreation was 2.2 percent of Kentucky's GDP that year, with 56,360 wage and salary jobs ^[15].

Two features of the site shape the income. The first is the dam. The 2007 floor statement records that the Corps had begun a rehabilitation project at Wolf Creek Dam on Lake Cumberland which had impacted some of the marinas in the area ^[16]; no source was gathered here for the depth or duration of any drawdown, so none is stated. The second is the shoreline rule: the water areas of Corps projects must stay open to public use generally for boating, swimming, bathing, fishing and other recreation, with ready shoreline access maintained for the public ^[17], so the marina sells moorage and service on a lake it does not control.

Decision. The study would frame the market as the visiting boater rather than the resident, would present the 2022 and 2007 visitor figures side by side with their sources, and would confirm the lake level and the dam program with the Corps district before projecting any revenue.

Demand: Registered Boats, Bigger Boats and Slip Waitlists

The demand case rests on three sourced observations and one assumption the study would have to prove.

The first observation is the boat count. The Coast Guard's Recreational Boating Statistics 2024 reports 141,751 recreational vessels registered in Kentucky in 2024 against 141,525 in 2023, under a system covering all motorized vessels except those with electric motors of 1 horsepower or less ^[18]. The state's fleet is flat, and a flat fleet does not by itself fill new slips; what fills them is a change in the kind of boat.

The second observation is that change. Leisure Investment Properties Group's 2025 report says larger vessels, particularly those over 25 feet, continue to fuel demand for marina services because storing them at home is often impractical, which has increased the need for wet slips and dry stack storage ^[19]. That is why this example sizes the new slips for bigger boats: the existing slips are an assumed 200 covered slips averaging an assumed 28 feet, and the expansion adds slips averaging an assumed 40 feet (Table 2).

The third observation is occupancy. Leisure Investment Properties Group reports that rental rates for slips and dry stack storage have benefited from high occupancy rates and extensive waitlists, trends it says remained strong into the first quarter of 2025 ^[20], while the same Leisure Investment Properties Group report adds that some locations are experiencing vacancies due to property-specific issues such as deferred maintenance or lack of amenities ^[21]. The model's assumed stabilized wet slip occupancy of 90 percent sits below the high occupancy in that report and above the deferred-maintenance case, and the study would replace it with the marina's own slip-by-slip history and waitlist (Table 2).

The assumption to prove is the rent. No public slip-rent survey for Kentucky lakes was found for this example, and the assumed annual wet slip rent of $120 per linear foot is a placeholder for the marina's own rent roll (Table 2). At that assumed rate and the assumed 90 percent occupancy the existing slips produce $604,800 a year and the new slips $216,000 (Table 4).

One tax question sits inside the rent line. Kentucky sales and use tax is imposed at 6 percent of gross receipts or purchase price, with no local sales and use taxes ^[22], and it applies to retail sales of tangible personal property and digital property and to sales of certain services ^[23]. The Department of Revenue says more than thirty additional service categories became subject to the tax and that businesses providing those services must collect the 6 percent sales tax from their customers ^[24]. Whether slip rent or dry storage rent is among those services was not sourced, and this example does not say whether it is; the study would obtain the Department's position in writing.

Decision. The study would treat the rent roll and the slip waitlist as the two documents that decide demand, would present the registered fleet as flat and the shift to larger boats as the reason new slips can lease, and would resolve the sales tax question with the Department of Revenue before projecting slip receipts.

Competition: State Park Marinas, Private Docks and the Barriers to New Supply

Kentucky State Parks operates 13 marinas ^[25]. They offer seasonal and annual boat slip reservations, and some also offer transient slips for daily visitors ^[26], so they compete directly for the annual slip tenant and for the transient boater who buys fuel and a night's dockage. Most Kentucky State Park marinas also offer boat rentals, from canoes, ski boats and pontoons to fishing boats, Jet Skis and houseboats ^[27], the same rental-fleet income this example projects at $336,000 (Table 4). The state park system also sets the seasonal pattern: while some of its marinas offer winter hours or stay open year-round, most operate seasonally from March or April to October or November ^[28].

The private-dock alternative is constrained by federal regulation, and that constraint protects the marina's slip franchise more than any zoning ordinance protects a shopping center. Under the Corps shoreline management rules in Appendix A to 36 CFR 327.30, permits for individually or group owned shoreline use facilities may be granted only in Limited Development Areas when the sites are not near commercial marine services ^[29]. A private shoreline use permit conveys no real estate or personal property rights or exclusive use rights ^[30], and engaging in or soliciting business on project land or waters without the express written permission of the District Commander is prohibited ^[31], so no one can open a competing fuel dock or slip rental on the lake without the Corps' leave.

The national picture is the same. Leisure Investment Properties Group, citing IBISWorld, reports approximately 10,500 marinas in use in the United States ^[32], and Leisure Investment Properties Group's 2025 report says new marina developments face significant barriers to entry from zoning, capital requirements and environmental considerations, so that limited supply creates a competitive advantage for existing marinas ^[33]. On a Corps lake the barrier is higher still, because the shoreline is federal and the concession is granted, not bought.

The competitive risk is therefore not new supply but the lake's existing marinas adding slips, as this one proposes to do, and the state park marinas' posted annual rates, which the study would compare with the assumed $120 per foot.

Decision. The study would list the state park marinas as the price-setting public competitor, would cite the shoreline management rules as the reason private docks cannot proliferate near a commercial marina, and would carry the lake's other marinas' slip expansions as the only new supply that matters.

Cost Basis: Buying the Leasehold and Building the New Covered Slips

Rounded to the dollar; lines may not foot by $1.

Every project input above is an assumption except the Treasury yield, the rental income multiplier and the supervisory loan-to-value limit.

The acquisition price is the largest line and the one with the most market context. The assumed price of $5,100,000 buys the marina leasehold, docks, buildings, equipment and operating business, and equals 7.17 times the marina's in-place rental income before the expansion (Table 3). That multiple is deliberately low. An appraiser writing in Leisure Investment Properties Group's 2025 Marina Investment Report extracted rental income multipliers from several marina sales where detailed income was available and found them ranging from 6.7x to 11.80x and averaging 8 to 9 times ^[34]. Leisure Investment Properties Group derives the multiplier by dividing the sale price by the rental income ^[36] and defines rental income for this purpose, in the same Leisure Investment Properties Group report, as slip and rack rental, yard and indoor storage income and building rentals ^[37], so the multiple is applied to slip, storage and dockage income only. The assumed price sits inside the reported range and below its average because the seller holds a percentage-rent leasehold on federal land rather than fee title (Table 2). For scale, Leisure Investment Properties Group's national data for marina sales of $1 million to $20 million show 70 sales in 2024 at an average price of $3,802,210 and a median of $3,600,000 ^[38].

The dock expansion is the second line. The model assumes 50 new covered floating slips with power and water at an assumed $45,000 per slip, which is $2,250,000, plus an assumed 10 percent construction contingency of $225,000 (Table 3). The per-slip figure is a placeholder for a dock builder's bid.

The Corps line is small in dollars and large in uncertainty. The model assumes $60,000 for the Corps lease amendment, environmental review and permitting, because the Corps sets these fees by district with no published schedule (Table 2). The 2024 field hearing statement says the Corps imposes administrative fees on the privately operated marinas on lakes such as Lake Cumberland ^[6]; the pending bill that would cap them ^[39] and bar them on a lease transfer ^[40] is a proposal, and this example budgets as if it were not law.

The remaining lines are an assumed $200,000 for rental fleet and equipment additions, an assumed $150,000 working capital and lease-up reserve that funds the year 1 and year 2 shortfall, and an assumed $180,000 for third-party reports, closing and financing costs (Table 3). Total project cost is $8,165,000. The requested loan at an assumed 65 percent of cost is $5,307,250 and the borrower's equity is $2,857,750, which is 35.0% of cost (Table 3).

Decision. The study would carry the acquisition price as a multiple of in-place rental income rather than as a capitalization rate, because the marina sales literature it can cite reports multipliers and not cap rates, and would flag the dock builder's bid and the Corps district's fee letter as the two cost inputs it cannot estimate from public sources.

Revenue Build: Slip Rent, Dry Storage, Fuel, Store and Rentals

The revenue build separates the income a lender will lend against from the income it will discount. Leisure Investment Properties Group's 2025 report says marina income from fuel sales, boat sales or service work carries a high cost of goods and labor and tends to be more volatile and riskier than rental income ^[41]. The model follows that distinction. Rental income, meaning slip rent, dry storage rent and transient dockage, is $927,300 at stabilization, 44.1% of gross receipts of $2,103,300 (Table 4). The rest is fuel, store, boat rentals and service.

Wet slip rent is built from linear feet: 5,600 feet of existing slips and 2,000 feet of new slips (Table 4) at the assumed $120 per foot and the assumed 90 percent occupancy give $604,800 and $216,000 (Table 4). Dry storage is an assumed 60 rack and land spaces at an assumed 85 percent occupancy and an assumed $1,500 per occupied space, giving $76,500, and transient and overnight dockage is an assumed $30,000 (Table 4).

The fuel dock is the largest non-rental line and the thinnest. The model assumes 100,000 gallons at an assumed $5.00 per gallon, giving $500,000 of fuel sales, against which the operating statement charges an assumed 79 percent cost of goods (Tables 4 and 6). Kentucky offers a partial offset the model leaves out. Under KRS 138.445, as the Department of Revenue's Form 72A005 states, a refund of Kentucky tax may be obtained on gasoline or diesel fuel bought to be sold for use in operating watercraft, but only by an operator of a public boat dock approved by the Department of Revenue ^[42]; separate approval must be obtained for each establishment that wants to sell watercraft refund motor fuels ^[43]. Because the approval is the buyer's to obtain after closing, the model treats the refund as upside rather than base case.

The ship store is an assumed $280,000 of sales at an assumed 60 percent cost of goods; the rental fleet is an assumed 12 pontoons and runabouts, each rented an assumed 80 days a season at an assumed $350 a day, giving $336,000; and service, launch and other income is an assumed $60,000 (Table 4).

The ramp is where the first two years are won or lost. Year 1 is the construction season, with none of the new slips leased; gross receipts are $1,887,300, net operating income is $372,943, coverage on the full loan is 0.77x and the cash shortfall after debt service is $112,712 (Table 5). The assumed $150,000 working capital and lease-up reserve is sized to absorb that year (Table 3). In year 2 the model assumes 60 percent of the stabilized new-slip income is in place, giving $129,600 of new-slip rent, net operating income of $490,879, coverage of 1.01x and cash flow after debt service of $5,224 (Table 5). Only in year 3 does the project reach the stabilized $569,503 and 1.17x (Table 5).

Decision. The study would present rental income as the coverage base and fuel, store and rentals as supplementary income with their own costs, would carry the watercraft fuel tax refund as unquantified upside pending the buyer's own Department of Revenue approval, and would treat the year 1 and year 2 shortfall in Table 5 as the lender's real underwriting case.

Debt Service Coverage, Loan Sizing and Sensitivity

The operating statement carries the two expense lines that make a Corps marina different from one on private land. The first is the Corps lease rent, charged at an assumed blended 3.0 percent of gross receipts, which is $63,099 at stabilization (Table 6). Corps marina rent is set under the Revised Graduated Rental System, which the pending MARINA Act defines as the system established in Engineer Regulation 405-1-12, or any successor the Secretary uses, for calculating rent on commercial concession leases ^[44], and the assumed 3.0 percent blended rate stands in for a rate table that could not be fetched for this example (Table 2). The House Oversight Committee's July 21, 2026 letter states that GAO reported in 2023 that the Corps did not consistently follow key practices for setting, reviewing and updating its user fees, particularly the lease rental rates charged to concession operators, which had not been updated since 1994 ^[45]. The same letter, citing the Corps Real Estate Handbook, says the concession objective can be achieved only if the operator has the opportunity to earn a fair profit ^[46]. A lender would read the actual lease and ask whether the percentage applies to fuel and food receipts, because the bill would exclude the combined covered receipts from the gross receipts calculation and apply a rate of not more than 1 percent to them ^[47], defining those receipts as the marina's receipts from prepared food, beverages, fuel, boats and expensive boat-related items such as motors and lifts ^[48].

The second line is insurance, an assumed $85,000 for docks, property, liability and fleet (Table 6). Leisure Investment Properties Group's 2024 report says full insurance of docks will be required where a new marina buyer plans to obtain a loan or is an investment firm representing other investors ^[49], so the study would carry a binder, not an estimate. Management is charged at an assumed 3.0 percent of receipts even where an owner-operator manages personally, because a lender underwrites a replacement manager, and the dock replacement reserve at an assumed $250 per wet slip is $62,500 (Table 6). Total expenses and reserves are $1,533,797, leaving net operating income of $569,503 and a margin of 27.1% (Table 6).

The coverage table gives the lender's answer. On the requested loan of $5,307,250 at 7.86% over an assumed 25-year amortization, annual debt service is $485,655 and coverage is 1.17x (Table 7). The lender's assumed minimum is 1.30x. The loan supportable at that minimum is $4,787,343, which is 58.6% of total project cost, and the reduction needed to get there is $519,907 (Table 7). The value test does not bind: at the low end of the average multiplier an appraiser reports in Leisure Investment Properties Group's 2025 report ^[34], the stabilized rental income of $927,300 indicates a value of $7,418,400, and the requested loan is 71.5% of that value (Table 7). That is inside the 85 percent supervisory loan-to-value limit for improved property ^[35] once the value is understood to rest on assumed rents; the guidelines say internal limits should not exceed the supervisory limits ^[50], the dock expansion is construction, for which the supervisory limit is 80 percent ^[51], and the assumed 65 percent loan to cost sits under both. Cash flow, not collateral, is the constraint.

The lease rows are the structural check. With an assumed 30-year remaining lease term at closing, 20 years remain at the ten-year maturity and 5 years remain after the 25-year amortization (Table 7); a lender refinancing at maturity would want a further extension.

The sensitivity table applies the stresses the interagency guidelines name, interest rates, vacancy and operating expenses ^[1], plus the one particular to a Corps lease. A 10 percent fall in every revenue line from the assumed base cuts net operating income to $442,803 and coverage to 0.91x; a 20 percent fall gives 0.65x (Table 8). A two-point rise in the rate before closing lifts debt service to $572,451 and gives 0.99x (Table 8). Expenses 10 percent above the assumed base give 1.04x, and wet slip occupancy 10 points below the assumed base gives gross receipts of $2,012,100 and coverage of 1.00x (Table 8). Doubling the assumed Corps rent rate, the case a lender would run because the rate table is unsourced, cuts net operating income to $506,404 and coverage to 1.04x (Table 8). No stress leaves coverage at or above the assumed 1.30x minimum, because the base case does not reach it.

The break-even table says the same thing in a marina operator's units. At the assumed $120.00 per foot, wet slip occupancy of 79.9% covers the debt at 1.00x, against an assumed base of 90.0%, a cushion of 10.1 points; the assumed 1.30x minimum needs 97.5% (Table 9). At the assumed 90 percent occupancy, $106.53 per foot covers the debt and $129.94 per foot meets the assumed 1.30x minimum (Table 9).

Decision. The study would report that the requested loan covers 1.17x against an assumed 1.30x minimum and does not meet it, that value is not the constraint at 71.5% loan to indicated value (Table 7), and that the bank's choice is between a loan of $4,787,343 at 58.6% of cost (Table 7) and a rent roll that proves $129.94 per foot or better (Table 9).

What a Conventional Bank Loan on a Corps Lease Requires and How the Study Would Meet It

This is a conventional loan by design, and the rules that bind it are the bank's own policy under the interagency guidelines rather than an agency's eligibility test. The guidelines ask the policy to require feasibility studies and sensitivity analyses ^[1] and to set minimum standards for debt service coverage ^[2], within supervisory loan-to-value limits of 85 percent for improved property ^[35] and 80 percent for commercial construction ^[51] that internal limits should not exceed ^[50]; the assumed 65 percent loan to cost and assumed 1.30x minimum here are one bank's policy figures inside those caps. The SBA and USDA routes for a marina are separate questions this example does not settle; it notes only that the requested loan of $5,307,250 (Table 3) exceeds the maximum of $5,000,000 for any one 7(a) loan ^[52], and that a USDA guarantee would turn first on whether the site is a rural area, a term the rule applies to any part of a state that lies outside a city or town above 50,000 population and outside the urbanized area next to it ^[53].

What a conventional lender must satisfy itself on, and what no agency form asks, is the federal lease. The statute leaves the lease period to the Secretary of the Army ^[3]; the water areas must stay open to public boating, swimming, bathing and fishing with ready shoreline access for the public ^[17], so the lease conveys a concession to serve the public, not an exclusive right to the water; and all money the United States receives for leases or privileges at these projects is deposited in the Treasury as miscellaneous receipts ^[54].

The bill matters to the study in one way only: it shows what the current lease does not give. The MARINA Act would amend section 4 of the Flood Control Act of 1944 so that Corps marina lease periods are not less than 50 years for an initial lease or the first renewal and not less than 25 years for later renewals ^[55], far longer than the assumed 30 years remaining in this example. It was introduced on January 27, 2026 and referred to the Committee on Transportation and Infrastructure ^[56]; its later status was not checked for this example, and the study would underwrite as if it never passes.

How the study would meet the conventional requirements is therefore straightforward. It would deliver the feasibility and sensitivity work the guidelines name ^[1] in Tables 8 and 9; it would test coverage against the bank's assumed 1.30x minimum and report the loan that meets it (Table 7); and it would make three lease items conditions of closing rather than assumptions: the Corps' written consent to assign the lease to the buyer, its consent to a leasehold mortgage in the bank's favor, and an extension that leaves the assumed 30 years, so that the 25-year amortization ends 5 years before the lease does (Table 7).

Decision. The study would state that the loan is conventional, that the bank's own policy figures for coverage and loan to cost are assumptions inside the supervisory caps, and that the Corps lease assignment, leasehold mortgage consent and extension are closing conditions without which the 25-year amortization has no basis.

Risks a Kentucky Marina Feasibility Study Would Flag

Lease term and renewal. The lease period is whatever the Secretary of the Army deems reasonable ^[3], and the statutory minimum that would fix it is only a proposal ^[55]. The assumed 30-year remaining term is a closing condition; if the Corps grants less, the amortization shortens and debt service rises above the $485,655 in Table 7.

Percentage rent on gross receipts. The rent is a share of receipts under a system whose rates the Oversight Committee's letter says had not been updated since 1994 ^[45], and the bill's proposal to exclude food, beverage, fuel and boat receipts and cap their rate at 1 percent ^{[47] [48]} implies they are reached today. Doubling the assumed rate gives 1.04x (Table 8). Administrative fees are imposed by district on marinas such as those on Lake Cumberland ^[6], and the schedule that would cap them is in the same unenacted bill ^[39].

Lake level and dam work. The Wolf Creek Dam rehabilitation affected marinas on Lake Cumberland, according to a 2007 floor statement ^[16]. The depth and duration of any drawdown are not sourced here, and the study would obtain the Corps district's operating plan and the lake's elevation history before projecting a season.

Seasonality. Most Kentucky State Park marinas operate from March or April to October or November ^[28], and a private marina on the same lake lives on the same calendar. Debt service of $485,655 is paid twelve months a year on roughly seven months of receipts (Table 7), so the bank would ask for a seasonal line of credit or a cash sweep.

Insurance and credit appetite. Full dock insurance will be required of a financed buyer, in Leisure Investment Properties Group's words ^[49], and the assumed $85,000 line is an estimate until a binder is in hand (Table 6). Leisure Investment Properties Group's 2025 report also says the gap between debt costs and marina capitalization rates is narrowing, which could widen the divide between buyers and sellers ^[57]; a buyer may find the price and the loan moving in opposite directions.

Rate before closing. The 10-year Treasury moved between 4.84 and 4.95 percent in a single week of November 2026 ^[4], and a two-point rise over the assumed 7.86% base takes coverage to 0.99x (Table 8).

Unsourced items. Kentucky slip rents, dry storage rents, fuel volumes, store sales and boat rental rates; marina operating expense ratios and capitalization rates; the Corps rent rate table and assignment procedure; Kentucky property tax on leasehold improvements; and the current status of H.R. 7248 were not sourced for this example.

What Would Decide the Outcome

Three items decide this example, and a feasibility consultant would spend most of the study's pages on the first two.

First, the marina's actual rent per foot and occupancy. The assumed $120 per foot is a placeholder because no public slip-rent survey for Kentucky lakes was found (Table 2). At the assumed 90 percent occupancy the debt is covered at $106.53 per foot and the assumed 1.30x minimum is met at $129.94 per foot (Table 9). If the rent roll shows the existing covered slips renting near the higher figure, with the kind of waitlist Leisure Investment Properties Group describes for the industry into early 2025 ^[20], the requested loan can be defended; if it shows rents at or below the assumption, the loan is the smaller one.

Second, the Corps lease. The Secretary may lease for such periods as he deems reasonable ^[3], so the assumed 30 years is a negotiation, not a right. The study would make the assignment, the leasehold mortgage consent and the extension closing conditions, and would read the actual rent schedule in place of the assumed 3.0 percent blended rate. A shorter lease than the assumed 30 years shortens the amortization and raises the $485,655 of debt service (Table 7); passage of the 50-year minimum in the MARINA Act ^[55] would let the bank lengthen it, though the study would not underwrite on a bill that has not passed.

Third, leverage, and the restructure that answers it. Table 11 keeps the purchase and the full dock expansion and cuts the bank loan to the $4,787,343 the base case carries at the assumed 1.30x minimum, rounded down to $4,780,000. Because the assumed $180,000 for reports, closing and financing is a lump sum rather than a share of the loan, total project cost stays at $8,165,000, and the buyer's equity rises by $527,250 to $3,385,000, or 41.5% of cost against the 35.0% of the request (Table 3). Annual debt service falls to $437,407 and coverage rises to 1.30x, so this restructure passes both tests: the assumed 1.30x lender minimum, which binds because a conventional loan has no program floor, and the 85 percent supervisory loan-to-value limit for improved property ^[35], with the smaller loan at 64.4% of indicated value. The margin is thin, $874 of net operating income a year above the minimum, so the restructure holds only while the assumed rents and occupancy hold. The other path is a bank that accepts a lower minimum for a borrower with strong outside liquidity, and the interagency guidelines leave that figure to the bank's own policy ^[2]; the study would present both paths and would not assume the bank bends.

Decision. The study would conclude that the requested loan does not meet the assumed 1.30x minimum at the stated assumptions (1.17x, Table 7), that the restructure in Table 11, a $4,780,000 loan with $3,385,000 of buyer equity, passes both tests, and that the outcome turns on the rent roll reaching $129.94 per foot (Table 9) and on the Corps granting the assumed 30-year term as a condition of closing.

FAQ: Choosing a Feasibility Study Company and Other Questions on Kentucky Marina Loans

Can a bank lend on a marina that sits on Corps of Engineers land? Yes, but the collateral is a leasehold, not fee title. The Secretary of the Army leases project lands for such periods and on such terms as he deems reasonable in the public interest ^[3], so the lender's first conditions are the Corps' consent to the assignment and to a leasehold mortgage and a remaining term that outlasts the amortization. Here the assumed 30-year remaining term leaves 5 years after the 25-year amortization (Table 7).

What is the break-even for this example? Wet slip occupancy of 79.9% covers the debt at 1.00x and 97.5% meets the assumed 1.30x minimum, against an assumed 90.0% base; in rent terms, $106.53 per foot covers the debt and $129.94 per foot meets the minimum, against an assumed $120.00 base (Table 9).

How does Corps rent work, and why is it a sensitivity column? Rent is a percentage of gross receipts under the Revised Graduated Rental System in Engineer Regulation 405-1-12 ^[44], whose rate table was not available for this example, so the assumed 3.0 percent blended rate is a placeholder for the lease's own schedule (Table 2). The Oversight Committee's letter says GAO found the rates had not been updated since 1994 ^[45], so the model doubles the assumed rate in Table 8, where coverage falls to 1.04x.

Is slip rent subject to Kentucky sales tax? This example does not say. The tax is 6 percent with no local additions ^[22], it reaches certain services ^[23], and more than thirty service categories were added to it ^[24]; whether moorage is among them was not sourced, and the study would ask the Department of Revenue in writing.

How should a buyer choose a feasibility study company or consultant for a marina on federal land? Ask three things. Has the consultant read a Corps concession lease and can the study explain why the amortization is set where it is? Does the consultant source market figures to named publishers and periods, and label every assumption as one, so the lender can swap in the rent roll, the dock bid and the lease schedule? Does the work include the sensitivities named in the bank's own guidelines ^[1] plus a break-even, so the lender sees that the requested loan does not meet the minimum?