Hotel Feasibility Study in the Indianapolis-Carmel-Greenwood, IN Metro Area

Branded hotels and one very large 7(a) holder

Brands dominate hotel lending in Indianapolis-Carmel-Greenwood: 76.2% of the 101 loans carry a franchise flag. SBA approved them from FY2017 to FY2026 for $265.0 million. Median size is $2.4 million, or 1.11x the national level, with the middle loans between $1.5 million and $3.6 million. Indianapolis stands thirteenth of 807 areas for lodging loans, and lodging is fifth among its own classes. The location quotient is 0.91x, a little below the national share.

Of the 101 loans, 84 are 7(a) and 17 are 504. Marion County has 60 of the loans, Hendricks County 11, Madison County 7 and Hamilton County 5. The concentration in Marion County, so the county dominates the loan count; the figures here are loan counts, not room counts.

GBank's outsized book

GBank holds 25 of the 7(a) loans, worth $96.0 million, far more dollars than the next holder. Behind GBank, Shoreham Bank has 11 loans worth $25.7 million, the Peachtree Group arm First Western SBLC, LLC has 7 worth $17.1 million, and PromiseOne Bank has 5 worth $6.0 million. The 504 holders are Premier Capital Corporation with 9 loans worth $20.0 million and Indiana Statewide Certified Development Corporation with 8 worth $20.8 million. These are present holders in SBA's files, which is a different thing from lender requirements.

Four things are not printed for Indianapolis: a cancellation rate, a charge-off rate, and yearly loans and dollars for both FY2019 and FY2022. Too few loans stand behind these, so Loan Analytics withholds them: none is a zero, and this page therefore carries no outcome floors. The years that remain run from 17 loans in FY2017, worth $28.7 million, to 14 in FY2026, worth $45.9 million, the largest annual dollar figure shown.

What an Indianapolis hotel study has to test

The market study separates group business, such as conventions and sports events, from transient and corporate demand, and tests how many rooms the added supply will take. Occupancy and average daily rate should be projected for the first three years of operation with the brand's own data and an independent comparison set. The property improvement plan and construction cost are the largest items, and debt service coverage should survive a sharp drop in occupancy. Because the entry blends limited-service and full-service properties, class averages describe neither type closely. The appraisal should treat the real estate and the franchise-dependent business as distinct. Counts for Marion County and the rest of the Indianapolis area omit any loan whose county the July 2023 list lacks.