Quick Service Restaurant Feasibility Study in New Mexico

Cancellation in New Mexico

Limited-service restaurants in New Mexico show a modest median loan and a high cancellation floor. There were 67 SBA approvals across FY2017 to FY2026, worth $31.5 million, and the class ranks 3 of 39 among New Mexico asset classes. Cancellation took at least 17.5% of approvals through FY2024 and, because the ceiling matches, it is a hard floor with no undisbursed loans to add. Nothing in this cell is called distinctive, so the median of $277,500, 0.89x the nationwide restaurant median, and the central band between $150,000 and $581,500 are read as part of the ordinary record, with no figure called out for special weight.

The state ranks 46 of 54 for this class and shows a location quotient of 0.71x, which means quick service restaurants are less common in New Mexico SBA lending than in the national book. Franchising still reaches 55.2% of loans, so brand systems drive most of them. Under 7(a) fall 61 loans and under 504 only 6. U.S. Bank, National Association has 8 loans and $2.3 million, while Wells Fargo Bank National Association has 5 loans and $2.5 million, a higher average ticket for the smaller count.

Albuquerque on the map

Bernalillo County holds 37 loans, far above San Juan at 5, Eddy at 4, and Lincoln, Sandoval and Santa Fe at 3 each. Annual counts peaked at 11 in FY2018 and 10 in FY2021, and the dollar high was $6.9 million on 6 loans in FY2024.

Of 33 New Mexico loans that disbursed earliest, at least 3.0% are written off so far, and 3.0% also failed in the first five years. The cancellation floor is the larger concern. Loan Analytics prints these as floors, and a lender should ask what drives that attrition.

What a New Mexico restaurant study has to test

With cancellation at this level, a study should explain why approved deals die: site control, a franchisor decision on a territory, construction bids, or equity that cannot be raised. Demand work needs traffic counts, daytime population and competitors within a short drive. Franchise fees and required buildout feed the cost line. Coverage must hold at sales volumes a new unit really achieves across its opening twelve months, and an appraiser should value the building and equipment on a liquidation basis.