Restaurant Feasibility Study in the Crestview-Fort Walton Beach-Destin, FL Metro Area

A location quotient of 1.87x

Full-service restaurants in the Crestview-Fort Walton Beach-Destin area stand out for concentration. A location quotient of 1.87x says restaurants are close to double their national share of loans here, and the class is first among all 39 in the area. Nationally the area is 85 of 821 for the class. The record holds 62 approvals totalling $35.9 million across FY2017 through FY2026.

Loans above the national midpoint

At $350,000 the midpoint stands 1.27x above the figure for restaurants nationally, and typical loans reach from $125,675 to $538,250. Under 7(a) there are 49 loans against 13 in 504, so some projects included real estate. Franchise share is only 12.9%, which makes this largely an independent-operator market.

Two counties, near-equal

Okaloosa County and Walton County each account for 31 of the loans, a symmetrical pattern. Community Bank of Mississippi is listed on 9 loans worth $1.4 million, and Newtek Bank, National Association on 7 worth $2.5 million. The holder field shows who carries the loan now, so these names say nothing about any lender's own policy.

The cancellation figure is the story

Cancellation after approval was 22.9% or more across the FY2017 through FY2024 approvals, and the ceiling figure that also counts undisbursed loans is identical. Take that as a floor, and a high one for any lender or borrower to overlook. No charge-off rate is reported, since the cohort holds under 30 loans. Read it as not reported, not as zero.

Years

Annual counts on file: FY2018, 8 loans and $1.4 million; FY2019, 6 and $2.4 million; FY2021, 7 and $3.3 million; FY2023, 6 and $3.8 million; FY2024, 12 and a standout $15.2 million; FY2025, 9 and $4.5 million; FY2026, 5 and $2.3 million. Remaining years are withheld for small counts.

What a Destin-area restaurant study tests

A restaurant study here must test seasonality first: how many months carry the year's sales, what the shoulder months look like, and whether the debt payment is covered when they do. It should also test waterfront and highway site cost, labor supply, insurance and elevation issues, and competition. The cancellation floor is a reason to examine permitting and closing risk. The appraisal must keep the going concern distinct from land and building.