Dental Office Feasibility Study in New York

Smaller dental loans, higher losses than the class

Dental practices in New York borrow less than the class does nationally and have lost more than it has. The median loan is $302,250, which is 0.60x the national median for dental offices, with the central range of loans running from $101,250 to $705,250. The charge-off floor of 4.3% among the 188 loans disbursed from FY2017 to FY2021 sits above the dental class nationally, though below New York's all-asset experience. The median and the charge-off rate are the two measures that pull this cell away from both comparators. New York ranks 4 of 54 among states for dental lending, on 390 loans and $221.7 million from FY2017 to FY2026, but dental is only 10 of 39 among the state's own classes, and a location quotient of 0.75x shows it holding a smaller share than nationally.

SBA 7(a) carried 344 loans and SBA 504 carried 46, most of those through Empire State Certified Development Corporation with 37 loans and $34.4 million. Live Oak Banking Company holds 34 loans for $30.4 million, far larger tickets than JPMorgan Chase Bank, National Association, which holds the same number of loans for $6.8 million. TD Bank, National Association holds 25, Manufacturers and Traders Trust Company 23 and Genesee Regional Bank 22. The franchise share is 0.00%.

Why the loss floor matters here

Within five years of approval, 2.1% of the cohort was charged off, so part of the loss arrived after the five-year mark. Cancellation after approval is 10.3% of FY2017 to FY2024 approvals, or 11.9% with undisbursed loans counted. For a lender, a loss floor above the national class argues for testing the practice's patients and payer mix rather than leaning on the loss floor alone. Lending was heaviest early, at 62 loans and $28.4 million in FY2017, fell to 22 loans in FY2020 and recovered to 48 loans and $29.7 million in FY2024.

The study a New York practice loan needs

A dental study starts with patients: population per chair in the draw area, the insurance mix, and the competing practices and group operators nearby. New York County with 58 loans, Nassau with 38, and Queens and Suffolk with 33 each lead the lending. Cost covers operatory build-out, imaging equipment and, in an acquisition, the price paid for goodwill. The coverage ratio belongs on collections rather than production, and after the selling dentist's patients have had time to drift. The appraisal must separate any real estate from the practice's goodwill.