Gas Station Feasibility Study in Utah

Utah fuel loans: smaller tickets, heavy 504 use

Utah gas station loans sit well below the class at the median: $748,000, or 0.71x the national figure, a gap that passes our distinctness margin against gas stations nationwide and against Utah's all-class record. The rest of the cell is modest. Utah's 89 approvals from FY2017 to FY2026, worth $90.1 million, rank 17 of 53 among states; the class places 12 of 39 among Utah asset classes; and the location quotient of 0.63x leaves it below its national weight. The program mix is the other notable feature, with 29 of the 89 loans under SBA 504 and 60 under 7(a).

Development companies and credit unions

Mountain West Small Business Finance is the leading Utah lender for the class, with 22 loans under 504 worth $19.6 million, and Intermountain Business Lending, Inc. adds 6 worth $6.0 million. On the 7(a) side, credit unions lead: America First Federal Credit Union has 10 loans worth $14.6 million and Mountain America FCU 8 worth $7.1 million, with Bank of Utah at 6. The middle half of Utah fuel approvals is tight, from $466,000 to $1.3 million, consistent with property-backed deals. Branded operations hold 50.6% of loans. Salt Lake and Weber Counties have 16 approvals each and Utah County 15, Davis 8 and Tooele 6. The record dipped to 4 loans in FY2022 and rose to 13 worth $16.4 million in FY2023.

Clean outcomes

Not one of the 44 Utah fuel loans disbursed over FY2017 to FY2021 has been written off, so the Utah charge-off floor stands at 0.00%, early and late. Cancellations ran to at least 8.2% of Utah approvals made from FY2017 to FY2024, and 9.6% with undisbursed loans included. Both are floors on a small cohort.

With so much of the Utah book in 504, a feasibility study here is usually financing real estate as much as a business. It has to support the land, building, canopy and tanks in the appraisal, and test fuel volume, inside sales and car wash or food income at the specific site against a loan near $748,000. Traffic counts, competing stations and the brand agreement all need checking, and the coverage of debt service should rest on realistic Utah margins, not peak-year ones.

Because the code describes the borrower's industry, Utah truck stops and travel centers are counted with gas stations that have no convenience store and cannot be split out. Nor does the 2022 industry index give EV charging an entry of its own.