Parking Garage Feasibility Study

Questions buyers ask

Who can write a parking garage feasibility study for my lender?

Loan Analytics prepares the study for your lender to file, at arm's length from the borrower and the seller, and Daniel Smith, MAI signs it. The report can go to a 7(a) or 504 lender, to a lender using USDA Business and Industry, or to a bank making a conventional loan. Its starting point is the parking record printed here, 302 7(a) and 51 504 parking loans from FY1991 to FY2026, and then it does what that record cannot do for a single site: it counts the site's demand, prices its competition, costs the structure or lot, and tests whether the revenue covers the debt. Every number in the report traces to a table on this page or to a source the report names, so the lender can check it.

Does my lender need a feasibility study for a parking lot or garage loan?

No rule cited on this page requires a study on every parking loan; the lender decides under its own credit policy. The record shows why a lender has reason to ask. Among 7(a) parking approvals of FY2017 to FY2024, cancellations stand at a floor of 20.5%, the 504 cohort is too small for any rate, and outside California no state has enough loans for a median. A credit officer facing that record has little program history to rely on, and a study that settles the contracts, approvals and costs behind the request supplies it. If your lender has already asked for one, send its requirements with the scope request so the report answers each point.

How much does a parking garage feasibility study cost?

Lots and garages go unnamed in the price bands of the 2026 fee survey we publish here, which sorts studies by type of job rather than by asset. Its band for one standard special-purpose site runs $5,000 to $12,500. Complex studies, the tier it gives to multi-site work and to building projects delivered in phases, are published at $10,000 to $25,000. Where USDA's rule in 7 CFR Part 5001 governs, the survey prices the work from $7,500 up through $18,750 and beyond. Buying an existing lot or garage as one site reads against the first range; a ground-up garage delivered in phases, or a group of lots, against the second. These are published market ranges, not a quote: our fee for your study comes back with the scope, once the site, the program and the lender's questions are known.

How long does a parking feasibility study take?

No turnaround is published on this page, and we give none until the scope is fixed. The time a parking study needs depends on what has to be counted and confirmed. An existing lot with operating statements and signed monthly contracts needs less fieldwork than a new garage, where demand has to be built up from the offices, clinics, venues and homes within walking distance and checked by hour and day. Event demand adds work, because each venue's calendar has to be measured, and a structure needs its construction or repair costs confirmed. The reply to a scope request sets a timeline against your lender's deadline, so put that date in the request.

What does a parking garage feasibility study test?

Demand, price, cost, coverage and value. Demand: the drivers the site can capture by hour, weekday and event. Price: the transient, monthly and event rates the site can hold against competing lots, garages and curb parking. Cost: paving or structure, lighting, access control and payment equipment, and for a deck a reserve for structural repair. Coverage: debt service tested on weekday income and on event income separately, net of the operator's fee, and again with the largest nearby source of parkers removed. Value: what the land is worth with and without the parking use. The tests are weighted by the record here, where a floor of 20.5% of FY2017 to FY2024 7(a) parking approvals never funded.

How many SBA loans have gone to parking lots and garages?

From FY1991 to FY2026 the SBA approved 302 7(a) loans to parking lot and garage businesses, for $123.4 million, and 51 504 loans, for $51.9 million. The FY2017 to FY2026 window accounts for 118 of the 7(a) loans and $68.0 million, and 22 of the 504 loans and $33.8 million. These are gross approvals with cancelled approvals counted, so the funded total is lower. The most active 7(a) years are the recent ones, with 16 loans in FY2024 and again in FY2026, and the most active 504 year was FY2023, at 7 loans for $7.1 million.

What size are SBA parking lot and garage loans?

It depends on the program. Over FY2017 to FY2026 the 7(a) parking loans have a median of $250,000, a lower quartile of $51,275 and an upper quartile of $717,250. The 504 loans have a median of $1.3 million, with quartiles at $612,000 and $2.0 million. California, the only state with enough loans for a median, shows $700,500 across both programs. No parking loan in either program reached the top size band. The study places your request against these figures, since the lender will compare it with them.

Which states have the most SBA parking loans?

California leads, with 32 loans for $36.4 million from FY2017 to FY2026, 25 under 7(a) and 7 under 504. Texas follows with 17 loans for $10.8 million. Florida, Georgia and New York show 10 each, but their totals differ widely: Georgia $15.4 million, Florida $6.6 million and New York $1.1 million. Minnesota shows 6 loans for $4.7 million and Colorado 5 for $6.2 million. Every other state in the table has 4 loans or fewer, and a number of states are not in it at all. Outside California the state rows are too thin for a median or a rate, and the study draws on the national figures for those.

Is SBA 7(a) or 504 more common for parking projects?

7(a), by count: 118 approvals in FY2017 to FY2026 against 22 under 504, and 302 against 51 over the full FY1991 to FY2026 record. The programs serve different loan sizes. Under 7(a) the quartiles go from $51,275 at the bottom to $717,250 at the top, and 49 of the loans fall in the smallest size band, where 504 has none. The 504 loans start higher, with a lower quartile of $612,000. In the fifth size band the programs are level at 6 loans each, so for the largest parking loans in the record either one has been used. The study is written to the program your lender chooses.

How often are SBA parking loan approvals cancelled?

Of the 7(a) parking approvals dated FY2017 to FY2024, at least 20.5% were cancelled and never funded. The figure is a floor, so the true share may be higher. The 504 rate is not printed, because the 504 cohort is below the 30-loan minimum, and the blank is not zero. Cancellation is the larger of the two outcome measures on this page, well above the 2.7% charge-off floor, which is why our study starts with what can undo a deal before closing: zoning and use approvals, the contracts and leases behind the revenue, the cost estimate, and the value the appraisal is likely to support.

What share of SBA parking loans end in a charge-off?

The FY2017 to FY2021 7(a) disbursement cohort shows a charge-off floor of 2.7% to date, and 0.00% of it was charged off inside 5 years. Each is a minimum counted on what SBA had recorded, and on the printed figures every recorded loss so far landed later than year five. For 504 neither rate is reported, since the cohort has fewer than 30 loans. No state, California included, has a cohort large enough for its own rate. A lender reading these figures will want coverage shown well past stabilization, through the repair cycles and contract renewals of the later years, and our projection runs to the end of the term.

Has SBA lending to parking businesses grown in recent years?

By count, yes. The 7(a) program approved 16 parking loans in FY2024 and 16 in FY2026, the most in any year since FY1991, after 15 in FY2023 and 14 in FY2025. The 504 program peaked at 7 loans for $7.1 million in FY2023, approved 0 in FY2024 and 2 in each of FY2025 and FY2026. The 7(a) dollars printed for FY2023 and FY2024, $8.8 million and $8.7 million, sit close to FY2013's $8.5 million, which came on fewer loans, so the counts have risen faster than the money. Most annual 7(a) dollar totals since FY2014 are withheld, and the study does not fill them in.

Has the SBA financed a parking project as large as mine?

The size bands answer this directly. From FY2017 to FY2026, 6 7(a) parking loans and 6 504 parking loans fall in the fifth band, the largest one occupied, and neither program shows a loan in the top band. The fourth band holds 18 7(a) loans for $26.4 million and 7 504 loans for $10.5 million. If your request sits in the fourth or fifth band, there is SBA precedent for its size, though only a handful of loans. If it sits above the fifth band, there is none in the window, so the amount must be justified by the study alone, through cost, value and coverage.

How does the feasibility study treat the land under a parking lot?

Separately from the parking business. A surface lot sits on land that a developer may value above what the lot earns as parking, and the study measures that value directly, because it is the lender's fallback if the parking income falls short. A garage is the opposite case: the structure has few other uses, so its value depends on parking revenue holding up, and the coverage tests carry more weight. The record puts that collateral test in the later years of the loan: 7(a) parking charge-offs reach a floor of 2.7%, with 0.00% inside 5 years.

Are truck parking and trailer yards counted in these figures?

They can be. Truck parking shares its industry code with car parking, so a yard for trucks and trailers financed under that code lands in the same totals, and the table cannot separate the two. That matters when a study cites the record. A lender weighing a downtown garage should not read the 118 7(a) loans and 22 504 loans of FY2017 to FY2026 as a set of comparable garages; some may be yards serving freight. Our study uses the record for the history and scale of SBA lending to the class, and builds its comparables from the parking facilities that actually compete with the site.

My state has one SBA parking loan, or none. Can a study still support the loan?

Yes, but it has to bring its own evidence. Hawaii, Oregon, Missouri, Tennessee and the other states with a single loan in the table, and states such as Washington, Nevada and Utah that are not in it, give a lender no in-state SBA history to compare. The study then cites the national record, 118 7(a) and 22 504 parking loans from FY2017 to FY2026, with their quartiles, size bands and the 7(a) floors of 20.5% cancelled and 2.7% charged off, and builds the market case from the trade area: counts of parkers by hour, the rates competitors charge, the contracts on offer, and the land value under the site.

Which lenders make SBA parking garage loans?

This page prints no lender table for parking lots and garages, so it names no lender, and our study will not cite a lender's record that the data here does not show. What the page does show is where the loans were approved: California with 32, Texas with 17, Florida, Georgia and New York with 10 each, and a long list of states with 6 or fewer. If you already have a lender, put its name and program in the scope request. If you do not, the study is still written so that whichever lender reads it, SBA, USDA or conventional, can use it as delivered.

What will a lender ask about weekday and event revenue?

Whether the loan is covered without the events. Event revenue depends on a calendar the operator does not control, so a lender will want debt service coverage shown on weekday income and on event income each by itself, after the operator's fee, and then combined. The study counts the events that drive demand from each venue's calendar and prices them against the competing event parking nearby. It also removes the largest single source of weekday parkers to show what remains. With 7(a) parking cancellations at a floor of 20.5% for FY2017 to FY2024 approvals, a revenue case that rests on an unsigned venue or employer agreement is exactly what a lender will press on before closing.

How does a parking feasibility study differ from the appraisal?

The appraisal states what the property is worth on a date; the feasibility study shows whether the parking operation can pay the debt over the term, which that value assumes. On a surface lot the two can diverge, since the land may be worth more for another use than the parking income supports; on a garage they move together, since the structure has few other uses. The lender reads both, and the study should be finished before the appraisal is final so that the income figures agree. Where the request is large, in the fourth or fifth size band, the lender will lean on both reports harder, because the record holds only a handful of loans of that size.

Why do some years in the table show withheld or not measured?

The tables use several labels, and none of them means zero. Fewer than 5 loans marks a dollar total that rests on too few loans to print. Withheld marks a dollar total that exists for a year with more loans but is not printed, as for every 7(a) year from FY2014 to FY2022. Not measured marks a year in which SBA's files give too few loans a usable industry code, as for 7(a) in FY2001. A printed 0 with $0, as for 504 in FY2005, FY2006, FY2012 and FY2024, is a real zero. Our study cites only printed values and treats each blank as unknown.