Gas Station Feasibility Study in Colorado

A thin slice of Colorado lending, with clean results

Gas stations take a small part of Colorado's SBA lending. The location quotient of 0.46x is well under parity, and inside the state the class ranks 15 of 39 by count. Colorado's 87 approvals for fuel retail in FY2017 to FY2026 carried $99.4 million, ranking it 19 of 53 among states, at a median of $910,000, or 0.87x the national median for the class. No figure passes our distinctness screen against both Colorado's all-class record and fuel retail nationally. What this cell adds is an outcome record that is clean so far and a lender list led by Hanmi Bank.

Hanmi Bank and the Front Range

Hanmi Bank tops the Colorado 7(a) list, 17 loans worth $19.2 million, ahead of Midwest Regional Bank and Commonwealth Business Bank with 7 each and The Bancorp Bank National Association with 5. On the 504 side, B:Side Capital holds 7. SBA 7(a) carried 73 loans in all and 504 carried 14. Branded and franchised sites account for 46.0% of loans. The middle half of approvals lies between $518,900 and $1.5 million, consistent with buying or rebuilding a site with its tanks and store. Jefferson County leads with 15 approvals, then Denver and Larimer with 11 each and Arapahoe with 9. Annual volume ran from 12 loans in FY2017 to 4 in FY2020 and 7 in each of FY2025 and FY2026.

Outcomes so far

Colorado posts a 12.3% cancellation floor on fuel approvals dated FY2017 to FY2024, with the ceiling at the same 12.3%, which sits below the class nationally. The 42 Colorado station loans funded between FY2017 and FY2021 have produced no loss so far: the charge-off floor is 0.00% overall and the same 0.00% over five years. A clean record on open loans is encouraging, not a guarantee.

A Colorado station study still has to earn the loan on its own site. Demand rests on traffic counts, turning movements and visibility at the corner, the competing stations and travel centers along the same route, and the store sales a convenience format can add to fuel margin. Cost covers land, canopy, dispensers, underground tanks and the store, plus any environmental remediation, priced at current quotes. Debt service coverage should be tested at conservative fuel gallons and inside sales, with brand or supply terms in the numbers. The appraisal of a station is a going-concern exercise that blends real estate with business value, and the study's stabilised income has to support that blended figure. Where electric vehicle charging is part of the plan, the study should treat it as an assumption to test, not a proven revenue line.

Coding limits apply in Colorado: the code records the borrower's line of business rather than the property, travel centers and truck stops are filed together with stations that have no store and cannot be pulled out, and EV charging has no entry of its own in the 2022 index.