Child Care Center Feasibility Study in Wisconsin

A steady Wisconsin child care book

Child care is one of Wisconsin's larger SBA classes: 251 approvals worth $143.7 million across FY2017 to FY2026 place Wisconsin 12 of 53 for the class, and within Wisconsin child care ranks 5 of 39. At a location quotient of 1.22x, centers claim more of Wisconsin's SBA activity than their national weight. The median loan is $303,500, which is 0.67x the national class median. None of the three measures (the median, the cancellation floor, the loss floor) lies far from Wisconsin's record across classes or from the class nationally.

The middle half of Wisconsin loans runs from $111,450 to $721,000. SBA 7(a) carried 202 approvals and SBA 504 carried 49. Byline Bank is the largest 7(a) holder by dollars, with 14 loans worth $18.7 million. U.S. Bank, National Association holds 13 worth $4.8 million, Summit CU 12 worth $3.1 million; Wisconsin Women's Business Initiative Corporation, also with 12, totals $2.0 million. The 11 loans held by The Huntington National Bank total $822,000. Franchise systems account for 10.0% of the count.

Clean losses, real cancellations

Not one Wisconsin center loan disbursed during FY2017 to FY2021 has been charged off so far: the floor is 0.00% across 106 loans, and 0.00% within five years. Cancellation is the cost that shows up instead, at 12.1% of Wisconsin approvals made in FY2017 through FY2024, rising to 13.6% at the ceiling if undisbursed loans count as cancelled. Lending has grown, from 16 approvals in FY2022 to 33 in FY2024 and 31 in FY2025, before 22 in FY2026.

What a Wisconsin center study must test

Milwaukee County holds 70 approvals and Dane 59, with Waukesha at 27 and Outagamie at 11, so most demand cases will be argued around Milwaukee and Madison. The Wisconsin study tests licensed capacity against the families within commuting distance, and how the revenue is built up. The cost case has to carry staffing at required ratios and any building work licensing demands. Model debt service coverage on a believable enrollment ramp and on tuition the trade area can bear. Where real estate is financed, the appraiser has to say what another user would pay for a building fitted out for child care. The code limitation matters here: SBA's center code also takes in family child care run from a home, so the two are mixed.