Fitness Center Feasibility Study in New Mexico

Brand-heavy gyms, ticket above the norm

New Mexico fitness lending is small but leans on franchises, which account for 44.7% of loans. From FY2017 to FY2026 the state shows 38 approvals worth $15.7 million. A median of $303,200 is 1.17x the national median, and typical loans fall between $120,500 and $498,250. The class ranks 45 of 54 among the states, 8 of 39 within New Mexico, and has a location quotient of 0.70x, a clear underweight. No gauge stands out against the benchmarks, so the cell is mostly a franchise story.

Programs, banks and counties

Of the loans, 34 are 7(a) and 4 are 504. The Huntington National Bank has 7 loans worth $1.6 million, while Wells Fargo Bank National Association reaches $1.7 million on 5, a larger average. Bernalillo County has 25 loans, a dominant share, while San Juan has 3 and Dona Ana and Sandoval have 2 each.

A bumpy series

FY2018 was the strongest year, with 6 loans and $4.3 million. FY2020 shows 1 loan for $255,000, FY2024 2 loans for $318,000, and FY2025 6 loans for $1.5 million. FY2026 closed with 4 loans and $1.6 million, so the series moves up and down from year to year. That unevenness is a reason to read the yearly counts as a range and not as a trend, particularly for a state where the class is a small underweight in the overall lending mix.

What we cannot print

This cell lacks two measures, cancellations and charge-offs, because each rests on a group below 30 loans. Nothing should be inferred from the blanks in either direction. Lenders are better served by requesting the track record of comparable units from the borrower.

What a study must test

The test starts with membership economics: how many households within a short drive can afford a monthly fee, how the local population ages, and how many gyms of each format already compete. A franchise sponsor will supply a revenue model, which the study should check against local incomes instead of accepting it. Fees, royalties and the equipment package belong in the cost line against a ticket near $303,200. Debt service coverage should assume slow early joins and a high churn year, and an appraiser will assign little real estate value to a leased club, so cash flow carries the credit.