Liquor Store Feasibility Study in the Minneapolis-St. Paul-Bloomington, MN-WI Metro Area

A liquor market at parity

Minneapolis-St. Paul is the calm counterpart to the louder liquor markets elsewhere. The location quotient is 0.98x, which is parity, and the median loan of $354,100 is 0.79x the class's national median. The area is 13 of 426 nationally for liquor store loans and liquor is 8 of 39 among the local classes. SBA approved 130 loans between FY2017 and FY2026, worth $69.0 million, with the middle half between $152,000 and $625,100.

Programs, franchising and counties

SBA 7(a) accounts for 116 loans and SBA 504 for 14, and franchised stores make up 12.3% of loans, a printed share, unlike some liquor markets where it is withheld. Hennepin County has 37 loans, Ramsey 35, Dakota 16, Anoka 14, Washington 11 and Sherburne 7. Annual volume peaked at 23 loans in FY2021, then slid to 5 in FY2026, the last year of the series and lightly populated at $1.9 million.

Holders listed by SBA

Twin Cities-Metro Certified Development Company holds 5 of the 504 loans, worth $6.9 million. On 7(a) paper, U.S. Bank, National Association appears 15 times for $4.2 million, Falcon National Bank 12 times for $6.6 million, The Huntington National Bank 7 worth $2.5 million, Sunrise Banks National Association 7 worth $1.1 million, and BankVista 6 worth $1.9 million. SBA records the holder of each loan today; this list conveys no lender's policy on liquor retail.

Cancellations

Cancellation reached a floor of 8.8% among the FY2017 to FY2024 approvals, a lean figure for a trade where other metros show much more. SBA's source leaves out two more rates for the Twin Cities, one on cancellation counting undisbursed loans and one on charge-offs, and an absent number is not a zero.

Testing a Twin Cities liquor store

State and local liquor licensing is the threshold question for a study, along with whether a license transfers with the business. Revenue should be built from the seller's sales and margin, not from the metro's national weight, because nothing about this market is unusual enough to carry a weak plan. The study should count competing stores within a drive time, test debt service coverage with a sales decline after the sale, and keep inventory financing separate from the real estate. The appraiser will want comparable store sales. A Wisconsin site would face different rules. Hennepin, Ramsey and the other counties come in through the July 2023 area list.