Restaurant Feasibility Study in the San Luis Obispo-Paso Robles, CA Metro Area

The Central Coast restaurant record: higher loans, high cancellation

San Luis Obispo's distinctive metric is its median loan: $497,000, which is 1.81x the national figure. The 44 full-service restaurant loans total $41.3 million, with quartile edges of $201,200 and $1.4 million. Locally restaurants rank 1 of 39, the location quotient is 1.26x, and the area places 110 of 821 nationally. San Luis Obispo County, CA carries all 44.

Independent operators

Franchise share is 0.00%. Of the 44 loans, 38 are 7(a) and 6 are 504. Independent operators dominate the wine-country dining scene, and the record reflects that.

One holder and a lumpy calendar

Community West Bank appears as 7(a) holder of record on 7 loans worth $16.5 million, a big share of the $41.3 million; the tally is SBA's and is no view of the bank. FY2017 printed 12 loans and $17.9 million, then FY2025 printed 5 and $2.0 million and FY2026 printed 6 and $5.8 million. Nine years between FY2018 and FY2024 are withheld, so the middle of the decade cannot be read.

A high cancellation floor

Cancellation struck at least 24.2% of FY2017 to FY2024 approvals; the ceiling also reads 24.2%, so floor and ceiling agree on nearly one in four, a rate that should unsettle any timeline built on a single closing date. A charge-off percentage is withheld, which should never be read as zero. Lenders and borrowers alike should plan for slippage. San Luis Obispo County supplies every one of the 44 loans, its name being the link to the 2023 list.

What the study should test

Wine-country tourism, Cal Poly and seasonal visitors drive demand, and the study should say which one the site depends on. Because roughly one approval in four was cancelled, a study should show how the plan handles permit delay and construction cost drift. Test sales per seat, rent and wage levels, and coverage at $497,000 and near $1.4 million. The appraiser should value the building, kitchen equipment and the going concern separately. Water and wastewater capacity charges, which can be large on the Central Coast, should be priced early because they can change the budget.