Dental Office Feasibility Study in Oregon

Oregon dentists lean on 504

Oregon's dental lending is unusual less for its size than for its structure. Of 91 SBA approvals to Oregon dental offices from FY2017 to FY2026, worth $69.7 million, 35 went through SBA 504 and 56 through SBA 7(a), a heavy weighting toward the program used to buy or build premises. The median Oregon dental loan is $524,000, 1.03x the national dental figure, and our screen flags neither size nor outcomes. Oregon ranks 28 of 54 among states for this class, dentistry sits 10 of 39 in the Oregon ranking of classes, and its 0.71x location quotient shows the class lighter in Oregon's SBA mix than nationally.

Evergreen and Live Oak

Evergreen Business Capital holds 23 of the Oregon 504 dental loans, worth $11.8 million, which makes it the main route to practice-owned real estate in the state. Live Oak Banking Company holds 13 of the 7(a) loans, but they total $22.9 million, the largest dollar block in the cell; Columbia Bank holds 7 for $2.0 million. Approvals stretch from $196,350 to $1.1 million across their middle half, and franchising is absent at 0.00%. Washington County leads with 18 approvals, Multnomah has 14, Lane 11, Clackamas 10 and Jackson 9. FY2021 was the peak year, with 20 approvals worth $17.5 million.

No charge-offs, many cancellations

Oregon dental borrowers who close have repaid: the 44 practices funded in FY2017 to FY2021 carry no charge-offs yet, 0.00% to date, and 0.00% for losses within five years. Getting to closing is the harder part. Oregon's floor for cancelled FY2017 to FY2024 dental approvals is 17.1%, and the ceiling, with undisbursed loans included, is 18.4%. Later events can raise either outcome figure.

For an Oregon dentist buying or building an office through 504, the study has to support the practice and the property alike. Demand testing should cover the patient base and payer mix within the practice's draw, the competing offices, and for a start-up the time needed to fill the chairs. Cost requires construction or tenant-improvement bids and equipment quotes, since a budget that moves is one reason approvals here are cancelled. Debt service coverage must carry both the senior bank loan and the development company's piece from collections at a realistic ramp. The appraisal will look at a medical office building's value to other healthcare tenants, which the study should evidence with local rents and sales.

The record covers only SBA-guaranteed loans, so Oregon practices financed with conventional bank debt or seller notes are absent, and each lender named is the current holder SBA reports, which may not be the bank that made the loan.