Child Care Center Feasibility Study in the Boston-Cambridge-Newton, MA-NH Metro Area

What Boston adds outside its state

From FY2017 and FY2026, by SBA's count, borrowers starting or acquiring child care businesses in Boston took 256 approvals and $155.0 million in gross dollars. In rank terms, Boston is 8 of 493 among metro and micro areas, and child care businesses sit sixth of the 39 classes counted for Boston. Most applicants drew amounts between $75,000 and $540,000. A ratio of 1.09x on the location quotient puts day care centers at a larger portion in Boston against the country as a whole. Loan size here is anchored by $250,000; set against the category's national midpoint, as reported, that is a ratio of 0.55x, so loans run smaller here.

Child care center loans by program in Boston

Of the 256 approvals, 186 are 7(a) loans and 70 are 504 approvals, which reports which SBA program day care centers projects tend to use around Boston. Franchise-affiliated borrowers make up 19.5% of child care center loans in Boston. For 7(a) loans in Boston, 45 loans sit with Eastern Bank, 11 with TD Bank, National Association and 8 with Customers Bank. Among 504 holders in Boston, Bay Colony Development Corporation is first in Boston with 34 loans, then Granite State Economic Development Corporation with 26. Treat the lender names as a record from SBA of who holds the loan at present: they locate the paper, not what a lender will ask of a borrower in Boston.

Boston by county and fiscal year

Middlesex County, MA holds the most approvals at 88; Essex County, MA follows with 58, and Norfolk County, MA has 41. FY2020 was the thinnest year at 11 loans and $9.7 million; FY2025 was the strongest at 39 loans and $14.4 million.

What the cancellation and loss rates permit a reader to say

Among 91 child care center loans in Boston in the FY2017 to FY2021 disbursed cohort, 5.5% had been written off to date, again a floor, and 5.5% were written off among five years of approval. Boston on this page is a set of counties paired by name to the 2023 statistical areas, by the file, so child care center approvals whose county cannot be assigned drop out of Boston as well. Across FY2017 to FY2024, 11.2% or more of Boston child care center loans were cancelled after approval; this is a floor, reaching 15.0% at the ceiling when undisbursed loans count. In-home providers are not separable from centers in these figures, so some of the Boston volume could be run from homes.

The questions a Boston study of day care centers must answer

Start with demand if child care centers are being weighed for Boston: children of care age nearby, plus licensed capacity against enrollment. A record of 256 loans is context, not proof for a particular address. The work must show debt service coverage for child care businesses in Boston in a late-ramp case; as a rule, the loss floors on this page explain why. An appraiser for a Boston project must speak to tuition or subsidy changes and special-purpose space resale. On cost, licensing, ratios and staffing and classroom and play space belong in the budget for child care centers, which is then read next to the $75,000 to $540,000 range lenders in Boston have funded.