Restaurant Feasibility Study in New Mexico

New Mexico restaurants: few loans, larger tickets, clean so far

New Mexico ranks only 46 of 54 among states for full-service restaurant loans, but inside the state the class is 2 of 39. SBA approved 98 loans worth $49.1 million over FY2017 to FY2026, and the 0.70x location quotient shows restaurants claiming less of New Mexico's SBA lending than they claim nationally. The New Mexico median of $348,000 is 1.27x the national restaurant median, with quartiles at $69,375 and $681,800. SBA 504 carries 20 loans to 78 under 7(a).

Lenders and counties in New Mexico

Capital Certified Development Corporation holds 13 of the 504 loans for $8.4 million, and Western Commerce Bank leads 7(a) with 13 for $4.0 million. U.S. Bank, National Association holds 8 that total $438,000, The Bank of Clovis 5 for $1.0 million and PNC Bank, National Association 5 for just $120,000. Franchises are 9.2% of loans. Bernalillo County's 31 loans and Santa Fe's 15 mean a site elsewhere in New Mexico has fewer local precedents in this record. Bernalillo County leads with 31 loans and Santa Fe with 15, followed by Eddy with 8, Dona Ana with 7 and Curry with 6.

The loss record is clean but thin. Not a single charge-off appears among the 35 New Mexico restaurant loans funded in the FY2017 to FY2021 cohort: 0.00% overall and 0.00% in the first five years; with a cohort that small, the figure is a floor and an encouraging one, not a promise. Cancellation is the visible risk, at 13.3% or more of New Mexico's FY2017 to FY2024 approvals, reaching 14.7% if loans still undisbursed are added. Recent years were busier, with 15 loans in FY2024 and 15 for $9.0 million in FY2025, after 5 loans for $4.5 million in FY2018.

What a New Mexico restaurant study must test

At a median near $348,000, the study has to price the building or build-out. A study has to test demand in the actual trade area, residents, visitors and daytime workers, against the restaurants already competing for them in Bernalillo, Santa Fe or a smaller county. Cost covers the purchase or construction, kitchen equipment and opening working capital. The payment has to be covered from realistic covers, check average and prime cost, after the owner's draw. For a building purchase, value should rest on comparable restaurant property sales, separate from the business.