Data Center Feasibility Study in the Los Angeles-Long Beach-Anaheim, CA Metro Area

Data center loans in the Los Angeles area

Los Angeles-Long Beach-Anaheim, CA stands 5 of 169 nationally for data center loans. Inside the area itself the class sits low, 25 of 39, and a 0.76x location quotient means data centers make up a thinner part of area lending than of lending nationally. Even so, SBA approved 37 loans worth $27.5 million here between FY2017 and FY2026. The area's median loan of $327,500 is 1.59x the median loan for the class nationally, so loans of this kind run larger here even though the class is a minor part of the area's loan book.

Size, counties and franchising

Half of the loans sit between $150,000 and $475,000. No loan carries a franchise brand, shown as a share of 0.00%. Los Angeles County records 25 of the loans and Orange County records 12. Loan Analytics withholds the counts by SBA program and by lender here, so this page names no lender.

Two years carry a volume: 6 loans and $8.1 million in FY2017, and 8 loans and $7.0 million in FY2024. The remaining years are hidden because each rests on too few loans, which is a different thing from none. Neither rate on cancellations nor charge-offs appears, because a rate stays unpublished until its cohort reaches 30 loans, and the data center cohort is smaller. Two limits shape any reading. Colocation buildings cannot be told apart from hosting services under the industry code, which also covers data processing businesses. And a loan reaches the area through its project county on the OMB delineation of July 2023, so a county that cannot be placed there drops the loan.

What a study for a data center loan has to test

Real estate and technology have to be pulled apart in a study. It should test power capacity and its cost, cooling, connectivity and the lease or customer contracts that will service the debt, then show coverage on contracted revenue and again on a slower fill. Because the code mixes hosting businesses with buildings, the comparison loans may be operating companies rather than property, and the study should name the kind of loan it is underwriting. An appraiser must decide whether value rests on the shell, on the installed infrastructure or on the going concern, and a loan near the typical $327,500 will not support the same answer as a larger one.