Child Care Center Feasibility Study in the Sacramento-Roseville-Folsom, CA Metro Area

A thin child care record with a 504 specialist

Child care centers are not Sacramento's strength in SBA lending. A location quotient of 0.65x puts the class well below its national weight, twelfth place locally, 12 of 39, and 44 of 493 nationally. Even so, 55 loans totalling $50.8 million went out between FY2017 and FY2026, and the midpoint loan was $482,400, which is 1.07x the national midpoint. Half the book falls between $262,500 and $1.1 million, so a center here is a seven-figure conversation about as often as a six-figure one.

Fixed-asset lending matters more than usual. Program use reads 39 on SBA 7(a) and 16 on SBA 504, a heavier 504 side than many service trades show, which fits a business that often owns its building. The Mortgage Capital Development Corporation accounts for 8 of the 504 loans, $9.1 million in all, and it is the only holder this page lists, because no 7(a) lender clears the listing threshold. Franchise flags mark 12.7%. A caution on the code: in-home child care lives in it too, so family child care homes cannot be pulled out from centers.

Counties and the loss floor

Sacramento County, CA supplies 34 loans and Placer County, CA 14, so the northeastern suburbs are a real block of the record. On loss measures, 16.7% is the floor for FY2017 to FY2024 approvals that ended in cancellation, and a version that adds undisbursed loans lands on 16.7% as well. SBA publishes no charge-off rate for this cohort, and a missing number there is not a zero.

Only four annual points print: FY2018 holds 6 loans and $6.9 million, FY2021 holds 5 and $3.1 million, FY2022 holds 8 and $5.4 million, FY2023 holds 5 and $5.1 million. The other years are not shown. Before a loan counts toward this metro, its county must be placed in the July 2023 delineation, otherwise it is dropped.

Sacramento child care: what to prove

Center demand rests on working-parent households, licensed capacity already open around the site and the enrollment ramp after opening. Costs to test include the building or conversion, playground and licensing against the $482,400 midpoint, plus staffing ratios that set payroll. Tuition has to cover debt service coverage at stabilized enrollment, and the appraiser must treat the operating center and its real estate with care. The finished report goes out under the name of Daniel Smith, MAI; any lender's answer is the lender's alone.