Hotel Feasibility Study in the St. Louis, MO-IL Metro Area

Steady lodging lending, light in the metro mix

St. Louis shows a hotel record of 48 loans approved between FY2017 and FY2026 for $120.3 million. By hotel loan count the area is 35th among 807, and hotels take 8th place among 39 local classes, but a quotient of 0.59x puts them well below their national share. Franchise flags are present on 83.3% of loans, so the typical hotel here is a branded property.

Loans at the national benchmark

The midpoint of $2.2 million is 1.03x the figure for hotels nationally, and the middle of the distribution is tightly bunched, from $1.7 million to $3.2 million. That narrow band means most loans are close to the median in size. Program counts read 27 in 7(a) and 21 in 504, so 504 is well represented.

Development companies in the 504 table

St. Charles County Economic Development Council is listed on 7 loans worth $22.8 million, a considerable sum, and Rural Missouri, Inc. on 5 worth $11.3 million. Both are 504 holders on SBA's current-holder basis. By county, St. Louis County, Missouri, has 18 loans, and Madison County and St. Clair County in Illinois have 7 each, so the record straddles the river.

Printed years and floors

FY2018 shows 5 loans and $11.7 million, FY2022 shows 7 and $11.2 million, FY2023 shows 7 and $19.3 million, and FY2024 shows 6 and $15.4 million. The other years are withheld. At least 12.8% of approvals from FY2017 through FY2024 were cancelled; that is a floor. Loan Analytics withholds two measures, the cancellation ceiling and a charge-off figure, and a withheld rate is not zero. The printed years are only a few of the ten fiscal years, so the series says little about the rest.

The St. Louis hotel study

A study here should identify the segment the hotel serves, whether business, medical, event or highway travelers, and test the competitive set in that segment. It should test cost per room against the brand's standards, the franchise fee and reservation-system costs, and the timeline to stabilized occupancy. Because 504 is a large part of the record, the real estate and its collateral value deserve their own analysis. The payment must be covered during ramp-up, and an appraiser must split value between the operating business and the building. One code serves hotels and motels both, so limited-service and full-service results are blended in the figures.