Quick Service Restaurant Feasibility Study in the Cleveland, OH Metro Area

Cleveland, OH: $64.4 million in limited-service restaurant loans

SBA's records show 209 authorized limited-service restaurant loans in Cleveland from FY2017 through FY2026, $64.4 million in gross dollars. Loans center near $150,000, and the middle half land between $50,000 and $369,000. Cleveland loans run 0.48x of the national limited-service restaurant median, which is below the nation.

Where Cleveland, OH stands, 2 of 39 in class

Counting Cleveland by program, 7(a) has 201 loans and 504 has 8, so 7(a) is bigger. The 201 loans under 7(a) far outnumber the 8 under 504. Branded units account for 46.4% of Cleveland loans in this class. Limited-service restaurant is 2 of 39 among classes inside Cleveland and Cleveland is 22 of 779 among areas for it. The Cleveland quotient is 0.80x, which puts the class lighter in Cleveland than nationally. Cuyahoga County, OH heads the county list at 124 loans; Lorain County, OH follows with 33, then Lake County, OH with 25.

Cleveland lenders, years and the $64.4 million record

Annual loans peak in FY2024 at 35 ($11.9 million) and bottom out in FY2023 at 13 ($4.9 million). Among 7(a) holders of limited-service restaurant loans, The Huntington National Bank (117 loans, $26.4 million); KeyBank National Association (19 loans, $3.8 million); Growth Capital Corp. (9 loans, $1.3 million). The 117 loans listed for The Huntington National Bank are taken from SBA's holder file; they count holdings and say nothing of the bank's conduct. Cancellation after approval is 10.7% at minimum and 14.9% at most, for Cleveland approvals of FY2017 to FY2024. 9.0% or more of 89 disbursed Cleveland loans are charged off here in Cleveland, and no within-five-years rate is printed.

The Cleveland study: demand, cost, coverage, appraisal at $369,000

A Cleveland, OH study starts with commuter flow past the site, drive-through and counter volume and the daypart mix; the 209-loan record cannot stand in for them. The Cleveland build or purchase has to absorb the drive-through lane, franchise-related outlays and the equipment package, and Cleveland figures should replace national rules of thumb. Debt service coverage joins the two: a project near $150,000, or anywhere from $50,000 to $369,000, must cover payments from stabilized cash flow, with a downside case beside it. Cleveland appraisers will value the equipment package, the pad or building and the lease terms one at a time, so the Cleveland, OH study ought to do the same. What was approved before does not settle the next request: the 209 Cleveland loans frame the study, and nothing more.

How to read Cleveland, OH's $64.4 million

By project county, Cleveland claims 209 loans. The July 2023 delineation puts Cuyahoga County, OH inside Cleveland, OH, and every county is paired by name. Cleveland cancellation covers FY2017 to FY2024 approvals across Cleveland; charge-offs cover FY2017 to FY2021 disbursements.