Medical Office Feasibility Study in Washington

Washington physician lending: modest loans, few failures

Washington practices borrow modestly: the median SBA physician office loan is $226,000, 0.66x the national physician-office median, and the middle half falls between $67,500 and $610,500. There were 139 approvals worth $85.0 million from FY2017 to FY2026, placing Washington 16 of 53 among states and physician offices 14 of 39 among Washington classes; at 0.67x, the location quotient shows medical offices taking a smaller share of Washington's SBA lending than they take nationally. No headline figure in the Washington cell clears our distinctness screen, so this page is read for its lenders, its regions and its outcome floors.

U.S. Bank, National Association leads with 18 loans worth $7.7 million. KeyBank National Association holds 12 for $2.3 million, JPMorgan Chase Bank, National Association 8 for just $685,500, Wells Fargo Bank National Association 7 for $6.0 million and Columbia Bank 6 for $824,500. SBA 7(a) carries 118 loans and SBA 504 21, with Evergreen Business Capital holding 10 for $8.5 million and Northwest Business Development Association 8 for $4.9 million. No franchise appears, at 0.00%. King County leads with 43 loans and Pierce with 24, ahead of Spokane at 11, Snohomish at 9 and Clark at 8.

Washington's floors on cancellation and loss

For Washington approvals of FY2017 to FY2024, cancellation sits at 11.2%, with no undisbursed loans left to raise the 11.2% ceiling. Of 60 loans funded in FY2017 to FY2021, 3.3% are charged off and 1.7% failed within five years, so losses are light and partly late. All are floors. The dollar line is uneven: FY2021 carried 21 loans for $19.8 million, FY2024 only 9 for $2.9 million, and FY2026 19 for $16.0 million.

What a Washington practice study needs to show

A study for a Washington physician practice should size the deal to its purpose: a loan near $226,000 usually buys equipment, a build-out or a share of a practice, while the larger loans at the top of the range carry a building through 504. Demand means the population and age mix of the service area, competing practices and health systems, and payer mix, in King, Pierce or a smaller market like Spokane. Cost testing covers equipment, tenant improvements and working capital through the reimbursement lag. Debt service coverage should rest on net collections after staff and physician compensation. If the Washington loan buys real estate, the appraiser should work from comparable medical office sales and leases, separate from the practice.