Child Care Center Feasibility Study in the New York-Newark-Jersey City, NY-NJ Metro Area

Where New York child care departs from its parents

The median child care loan around New York-Newark-Jersey City is $322,000, and size is where this cell breaks from its parents. It is 0.71x the national median for the class, so centers here are financed lighter than centers elsewhere, even though the middle half of loans reaches from $75,000 to $898,000. The file totals 654 approvals and $490.5 million for FY2017 to FY2026. Child care here puts the market at 1 of 493 nationally, while inside the market the class sits at 5 of 39, with a location quotient of 1.01x, almost level with the national mix.

Programs and brands are lopsided. SBA 7(a) carried 596 loans and SBA 504 only 58. A franchise share of 21.7% means a real minority of projects sit inside a brand system, and a borrower should say which side of that line it is on. Because the median is light against the nation, a request far above $322,000 needs a clear reason, such as a purchased building or a large licensed capacity.

Lenders and places

SBA 7(a) is led by TD Bank, National Association: 118 loans, $47.8 million. JPMorgan Chase Bank, National Association holds 37, as does Manufacturers and Traders Trust Company; Provident Bank and Northeast Bank (ME) hold 25 each. Provident Bank's 25 loans total $26.0 million, against $3.3 million for the 25 at Northeast Bank (ME). Over on SBA 504, Empire State Certified Development Corporation appears with 31 loans and $46.0 million. Read each count as what SBA lists the institution as holding now or having held; it says nothing about how TD Bank, National Association or any peer lends. Kings County, NY has 82 loans, Essex County, NJ 52, Bronx County, NY 49 and Queens County, NY 47, with Middlesex County, NJ at 45 and Suffolk County, NY at 43.

Looking at approvals from FY2017 through FY2024, SBA shows 11.9% cancelled after approval (a floor) and 13.6% when undisbursed loans are counted as cancelled. Follow the 248 loans that disbursed during FY2017 to FY2021: 5.2% have since been written off, a floor. The five-year figure is held back by Loan Analytics, so no number appears for it. Two limits matter. Because family child care homes share the code, some of these loans may finance home providers instead of centers. Placement by project county under the 2023 delineation means an unplaceable county drops the loan from every metro, New York included.

Testing a New York child care project

Licensing capacity and the number of working households within reach of a site come first, because enrollment, not building size, pays the debt. Cost testing covers safety build-out, classrooms and outdoor space against a $322,000 median. Coverage rests on tuition, staffing ratios and enrollment ramp-up, and the appraisal must reflect a building built for one use. The 654 approvals are background, and approval is never promised; the loans above forecast nothing for a new request.