Child Care Center Feasibility Study in the Allentown-Bethlehem-Easton, PA-NJ Metro Area

Allentown-Bethlehem-Easton: child care ranks third

Among the 39 classes in SBA's Allentown-Bethlehem-Easton, PA-NJ record, child care centers take third place (3 of 39), and the area is 53rd of 493 for the class. The location quotient of 1.73x puts child care well above its national weight in the local loan book, while the median loan of $400,700 comes to 0.89x the national median, a little under it. Across FY2017 to FY2026 the file holds 35 loans worth $18.7 million. A lender reading this sees a class that appears here more often than elsewhere yet is financed at slightly smaller scale than the national norm.

Of the 35 loans, 28 fall under 7(a) and 7 under 504. The middle half of loan sizes runs from $140,000 to $702,500, a spread wide enough that both a leased conversion and a built centre fit inside it. Franchise units are 34.3% of the total. Allentown's file names no lender, as no holder reaches 5 of the loans. Lehigh County alone has 25 of the 35, so the remaining counties of the area share ten loans between them.

Reading the years and the code

What sits behind this class is a code that also covers home-based providers, and home-based care cannot be pulled apart from centres, so a few of the 35 may be homes. Only three years carry enough loans to show: 5 in FY2018 worth $1.4 million, 6 in FY2021 worth $7.4 million and 5 in FY2024 worth $1.5 million. The FY2021 total is far larger than its neighbours, which a reader should treat as a few large loans rather than a pattern. Allentown's other years hold too little to print. Its cohort numbers under 30 loans, which is why no cancellation or charge-off rate appears. A loan counts toward this area only if its project county falls inside it on the 2023 delineation.

What a child care study in this area must test

A feasibility study for a centre here has to test enrolment against licensed capacity, tuition and staffing ratios, and how quickly rooms fill after opening. Building or conversion cost should be set against the $400,700 median, allow for the licensing steps before the first child is enrolled, and show that income covers debt service under a slower fill. Because the record cannot separate centres from home providers, the study should rely on the actual competing centres near the site and not on this page alone. The appraisal will lean on income, so every revenue input needs a source.