Medical Office Feasibility Study in Maryland

Small practice loans in Maryland

Maryland physicians borrow small amounts through SBA. The median medical office loan is $182,100, only 0.53x the national median for physician practices, and the middle half of Maryland approvals runs from $72,500 to $540,250. The class carries its national weight here: a location quotient of 1.01x, a place of 8 of 39 among Maryland asset classes, and 123 approvals worth $55.1 million from FY2017 to FY2026 for a rank of 18 of 53.

One leading lender, little use of 504

Manufacturers and Traders Trust Company holds 43 of Maryland's 120 SBA 7(a) loans to physician practices, worth $4.2 million. Wells Fargo Bank National Association's 9 loans reach $8.2 million, a larger average, and Newtek Bank, National Association has 7, The Huntington National Bank and Truist Bank 5 each. SBA 504 carried only 3 loans. Franchising is minimal at 2.4%. Of the 123 approvals, 120 went through 7(a) and 3 through 504, so program choice is nearly fixed. At 18 of 53, Maryland sits in the middle of the states for this class. Montgomery County leads with 30 approvals, Prince Georges has 25 and Baltimore County 16. Lending has grown recently, to 23 loans in FY2025 and 24 in FY2026, after just 2 in FY2020.

Cancellations and early losses

Cancellation removed at least 13.2% of Maryland physician approvals from FY2017 to FY2024, and 15.8% counting loans still waiting to fund. The charge-off floor is 3.0% of the 33 Maryland practice loans disbursed in FY2017 to FY2021, all of it inside the first five years. With a cohort of 33, read both Maryland rates as floors and as rough.

A feasibility study for a Maryland medical office must match the size of the deal. For a small working capital or equipment loan, it has to show that collections and the payer mix will service the debt while the practice ramps or a new physician builds a panel. For a practice purchase, it must test patient retention after the seller leaves, reimbursement under the practice's main payers, and staffing cost against the loan. Debt service coverage needs proving in the first years, when the recorded losses happened, and if a Maryland practice also buys its office, the appraisal must support that real estate independent of the practice.

Maryland's numbers rest on the industry code on each physician loan.