Quick Service Restaurant Feasibility Study in the Fresno, CA Metro Area

Fast food is Fresno's second class

Limited-service restaurants are number two of 39 asset classes in the Fresno area. A location quotient of 1.29x shows more weight in local lending than the nation gives them. SBA's file holds 68 loans for FY2017 to FY2026 and $27.0 million approved. The median of $249,950 is 0.80x the national figure, and the middle half spans $124,900 to $492,500. Counting every metro and micro area, Fresno comes in at 52 of 779 for quick service.

Brands decide a lot

Franchise share is 55.9%, so a brand sits behind more than half the loans. That brings the franchisor's required buildout, royalty and sales assumptions into the feasibility picture. Fresno shows neither a 7(a) tally nor a 504 tally. Geography is tight: Fresno County, CA accounts for 63 loans and Madera County, CA for 5.

Holders and the calendar

Three 7(a) holders clear the listing threshold in Fresno: The Huntington National Bank (6 loans, $1.8 million), Celtic Bank Corporation with 5 and $2.0 million, and Community West Bank with 5 and $1.2 million. SBA's holder column supports tallies, not conclusions about lending. FY2017 and FY2018 each had 9 loans, at $2.1 million and $1.9 million. FY2019 had 6 and $3.8 million, FY2020 had 5 and $1.6 million, FY2023 had 10 and $3.7 million, and FY2024 had 7 and $988,800. FY2021, FY2022, FY2025 and FY2026 are withheld.

Floor and ceiling meet

For FY2017 to FY2024 approvals, the floor on cancellation is 13.2%, and a ceiling that treats undisbursed Fresno loans as cancelled also reads 13.2%, so the two ends agree. No charge-off rate is given, and it is not zero. Fresno membership comes from placing each project county, by name, inside the July 2023 Fresno area.

The Fresno study's job

A drive-through restaurant lives on its pad, so the study needs a traffic count at the site and a census of competing drive-throughs, then a check of the franchisor's sales expectations against what the draw area supports. Cost work covers the kitchen line, the lane and the sign package. Coverage should be run at a mid-sized Fresno loan and at the high end, and the appraiser should split the building, the equipment and the franchise rights.