Hotel Feasibility Study in the Denver-Aurora-Centennial, CO Metro Area

Where Denver stands for this class

Denver accounts for 120 SBA loans to hotel and motel projects from FY2017 to FY2026, adding up to $322.2 million in gross dollars. Nationally Denver ranks 9 of 807 over metro and micro areas for these loans, in plain terms, and inside the area the class ranks 9 of 39 among the lending classes. Loan size here is anchored by $2.4 million; set against the class's national median, in practice, that is a ratio of 1.11x, so approvals run larger here. The middle half of loans sit between $1.3 million and $4.1 million. The location quotient, 0.70x, means lodging properties make up a smaller share of area SBA lending against the nationwide mix.

The Denver lender and program record

On the 504 side, the largest holder is B:Side Capital, with 15 approvals; Preferred Lending Partners ranks second at 5. By program, the record counts 90 approvals under 7(a) and 30 under 504, a mix that tells a borrower which program lodging properties borrowers have used in Denver. Among 7(a) institutions in Denver, Bank of Hope is first in Denver with 22 approvals, trailed by Open Bank with 16 and Hanmi Bank at 12. The franchise share of Denver loans is 48.3%. Lender figures for hotel and motel projects in Denver reflect SBA's current-holder records: as a rule, credit goes to the present holder, in plain terms, which says nothing about credit practice.

Where in Denver and when

33 approvals sit in Adams County, CO, 30 in Jefferson County, CO and 25 in Denver County, CO. FY2018 was the thinnest year at 6 approvals and $21.2 million; FY2017 was the fullest at 22 approvals and $40.6 million.

Floors that can only rise for hotel and motel projects

The Denver figures are county-built: Denver counts a lodging approval only when the county SBA lists for the project falls inside the metro under the 2023 boundaries. The loss rate for hotels and motels in Denver stays hidden; Loan Analytics withholds rates for cohorts under 30 loans, so no figure is quoted. Because one code spans every lodging property, these Denver figures cannot separate limited-service hotels from full-service ones. Over FY2017 to FY2024, 8.8% at the least of Denver hotel and motel loans were cancelled after approval, a lower bound (no ceiling is shown).

Feasibility questions for hotel and motel projects around Denver

Any feasibility work on hotels and motels in Denver begins with demand: room demand from travelers, and seasonal occupancy swings. The 120 approvals show that institutions have funded the class in Denver; they do not show a single site clears the same bar. Debt service coverage then has to survive a slower opening than planned, because some Denver approvals were cancelled and some were charged off. The appraisal needs its own attention: value of rooms against land, and franchise terms in a sale. The build-out budget should itemize building cost per key and housekeeping and desk payroll, and then be laid beside what Denver lenders financed: $2.4 million at the median.