Restaurant Feasibility Study in Kentucky

Kentucky's busiest SBA class

No asset class in Kentucky draws more SBA loans than the full-service restaurant: it ranks 1 of 39 among the state's classes by count. Against other states Kentucky is mid-table, 36 of 54, with 224 approvals worth $89.9 million over FY2017 to FY2026, and at 0.91x the location quotient puts sit-down dining slightly below its national share of Kentucky lending. The median approval, $206,850, is 0.75x the national median for the class. By our screen nothing here is distinctive, since no metric stands apart from both Kentucky's all-class record and full-service restaurants nationally. The point of this page is that restaurants are the most common SBA credit a Kentucky lender sees, and the loans are modest.

Huntington, local banks and Louisville

The Huntington National Bank holds 42 of the 7(a) loans, worth $10.3 million. Republic Bank & Trust Company and Community Trust Bank, Inc. hold 21 each, the first worth $10.5 million and the second $3.5 million, while Stock Yards Bank & Trust Company's 14 come to $8.7 million and U.S. Bank, National Association's 14 to only $342,000. Capital Access Corporation - Kentucky is the leading 504 holder with 10. Altogether 205 approvals were 7(a) and 19 were 504. Kentucky restaurant loans range from $50,000 to $522,000 across their middle half, and franchised concepts account for 24.6%. Jefferson County leads with 79 approvals, Fayette has 23 and Kenton 19. Approvals were highest in FY2017, at 34 worth $13.5 million.

Outcomes

Cancellations claimed at least 9.0% of Kentucky's FY2017 to FY2024 restaurant approvals, and the ceiling is likewise 9.0%, below the national rate for full-service restaurants. Losses are higher: among 102 loans funded during FY2017 to FY2021, 6.9% have been charged off so far and 3.9% within five years, which is higher than full-service dining nationally, though the screen leaves it unflagged.

For a Kentucky restaurateur, the numbers say deals usually close but a meaningful share later fail, which is where a feasibility study earns its keep. Demand should be measured for the specific concept and location: households and daytime population within a short drive, visitor traffic where it matters, and rival restaurants pitched at a similar check. The menu, seat count, turns and average check have to produce sales the site can plausibly support. Cost covers the build-out or renovation, kitchen equipment, licensing and pre-opening expenses. Debt service coverage should hold after food, labour and occupancy costs at a realistic sales level, with a downside. When a building is part of the loan, an appraiser will value a restaurant property whose reuse depends on the next operator, and the study should ground that value in income it can document.

Kentucky's outcome rates are floors from approval and disbursement cohorts; lender names are the current holders as recorded by SBA.