Gas Station Feasibility Study in Mississippi

Mississippi leans on fuel retail more than most states

Gas stations and truck stops rank 4 of 39 among Mississippi's asset classes, a very high placement, and the location quotient of 1.35x shows fuel retail taking a bigger share of SBA lending than the national pattern. The 53 loans approved over FY2017 to FY2026, worth $58.3 million, rank the state 31 of 53 by volume. Half of loans are under $874,900, which is 0.83x the national figure for the class, and the interquartile range reaches from $328,100 to $1.4 million. Mississippi therefore finances fuel sites somewhat smaller than the country does, but still at a scale where real estate and equipment are both involved.

Nearly all 7(a), with many mid-sized lenders

SBA 7(a) carried 52 loans and SBA 504 carried just 1. Franchise affiliation reaches 20.8% of loans. More lenders reach five loans here than in many states: Renasant Bank with 11 loans worth $16.2 million, Peoples Bank with 6 worth $6.0 million, Community Bank of Mississippi with 6 worth $3.0 million, Celtic Bank Corporation with 5 worth $8.7 million, and Covington County Bank with 5 worth only $318,000. DeSoto County has 10 loans, Hinds 7, and Covington and Tunica 4 each.

Cancellation and an irregular calendar

Losses between approval and funding reached at least 17.8% for FY2017 to FY2024, with an identical ceiling, which is roughly one approval in six. The charge-off column stays blank for Mississippi: under 30 loans were disbursed in the cohort, so nothing is printed and nothing should be assumed. Volume is irregular: 0 loans and $0 in FY2019, then 14 loans and $17.4 million in FY2021, and 5 loans worth $12.6 million in FY2025.

Testing a Mississippi fuel site

The study must test highway and local traffic, competing stations, and the convenience sales that give a fuel site its margin. It should price tanks, canopy and environmental diligence with a contingency, and test coverage when fuel margins are thin. For a lender, the appraisal and the brand or supply contract are the points where deals most easily fall apart.

Classification follows the industry the borrower reports. Travel centers stay inside the wider fuel station group, and vehicle charging has no line in the 2022 index.