Fitness Center Feasibility Study in Kentucky

Kentucky gyms: a top class with small loans

Fitness centres rank 4 of 39 among Kentucky's SBA asset classes, and a location quotient of 1.18x says they carry more weight in Kentucky's lending than in the national mix. Yet the loans are small. Kentucky's median approval of $150,000 is 0.58x the class midpoint nationally, and the state's 113 loans and $37.4 million over FY2017 to FY2026 rank it only 30 of 54 among states.

Franchised studios and Kentucky's lenders

Franchises account for 38.1% of Kentucky's gym loans. Kentucky gyms financed 109 of these deals through 7(a) and just 4 through 504. The Huntington National Bank holds 17 Kentucky loans for $3.7 million; Community Trust Bank, Inc. holds 11 totalling $1.1 million, Stock Yards Bank & Trust Company 10 worth $4.1 million and Republic Bank & Trust Company 9. Half of approvals sit between $57,000 and $388,800. Jefferson County leads with 39 loans and Fayette follows with 20, then Warren with 10 and Kenton with 7. The series is uneven: FY2020 shows no approvals at all, while FY2026 brought 22 loans worth $6.4 million, the most in any year.

Floors for Kentucky gym loans

Cancellations stay modest in Kentucky: a floor of 7.8% on FY2017 to FY2024 approvals and 9.1% with undisbursed loans counted. Of the 49 Kentucky gym loans paid out from FY2017 to FY2021, 4.1% are charged off to date against 2.0% within the five-year mark, which tells us some Kentucky losses came later. Open loans keep both as floors. For a borrower, a gym has to hold members well past opening to carry its payments.

The study behind a Kentucky gym loan has to start with membership demand: households and workers within a short drive, their incomes, and every competing gym, studio and low-cost club in Jefferson, Fayette or the site's own county. The 109 loans under 7(a) and 4 under 504 make up the whole 113-loan cell, so program choice is not a variable in this record. With a median of $150,000 at 0.58x the class midpoint nationally, a request well above that level should explain how the project differs from the Kentucky record. Cost has to cover equipment, fit-out and the pre-opening membership drive. Debt service coverage depends on how fast members join and how many stay, so the study should model attrition explicitly and show coverage in the first full year. The appraisal matters only if property is pledged; otherwise cash flow carries the Kentucky case.