Medical Office Feasibility Study in Indiana

Indiana physician offices: a small footprint

Medical office lending in Indiana reads like its parents, with a lower location quotient. SBA approved 71 physician office loans from FY2017 to FY2026, $34.7 million in all. Indiana ranks 23 of 53 for the class, and physician offices rank 14 of 39 among the classes there. With a location quotient of 0.45x, practices make up only a small share of Indiana SBA lending, and the $190,000 median is 0.56x the nationwide figure. The cell has no outlier among its figures, so the state and class ratios carry the description.

Half of Indiana loans fall between $80,500 and $470,000. The 7(a) program accounts for 58 loans here and the 504 program for 13, so 7(a) is the main route. Franchising is 1.4%. Huntington National Bank has 14 of the 71 loans and $4.7 million, and Centier Bank has 5 loans and $881,100.

Hamilton County and the rest

Hamilton County has 14 loans, ahead of Allen, Lake and Marion at 7 each, and Floyd at 5. Approvals ran at 11 in FY2017 and dipped to 3 in FY2022 and FY2023. They climbed to 10 loans and $6.2 million in FY2025, and FY2026 shows 5 loans worth $7.1 million.

Indiana approvals through FY2024 show a 10.7% cancellation floor, identical to the ceiling. Among the 39 loans in the earliest disbursed group, at least 5.1% are charged off to date and 2.6% went bad within five years. Both are minimums, and one default shifts a cohort this size visibly.

Indiana diligence: physician first, building second

A study of an Indiana medical office should test the physician side before the real estate. Demand means patient volume for the specialty, referral ties, hospital affiliation and payer contracts. Supply means the practices already serving the catchment and whether the doctor can be recruited and kept. Cost covers shell, exam rooms, procedure equipment and accessibility compliance. Coverage should rest on collections, not billings, with a ramp for a new practice. An appraisal ought to split real estate from goodwill, since a lender leaning on the building needs to know what another medical tenant would pay.