Restaurant Feasibility Study in the Scranton--Wilkes-Barre, PA Metro Area

A small metro whose restaurant share is large

Scranton-Wilkes-Barre lists full-service restaurants first among its asset classes (1 of 39), and the 1.71x location quotient puts them well above the national share. The area is 64 of 821 nationally. SBA approved 82 loans between FY2017 and FY2026, worth $26.6 million. Loans run small. The $222,500 median is 0.81x the class's figure across the country, and the middle of the range is $100,000 to $438,725.

Lackawanna and the rest

Lackawanna County supplies 43 of the loans. By program, 76 loans are 7(a) and 6 are 504; franchised restaurants are 6.1%. The series is printed for FY2017 through FY2019, FY2021 and FY2023 through FY2026, with 13 loans in FY2025 and 12 in FY2024. FY2020 and FY2022 are suppressed on thin counts, which is not the same as zero.

Local banks lead

Fidelity Deposit and Discount Bank holds 25 loans worth $5.2 million, well ahead of Peoples Security Bank and Trust Company with 9 and $3.0 million, PS Bank with 7 and $1.8 million, Manufacturers and Traders Trust Company with 7 and $1.0 million and Mid Penn Bank with 5 and $2.8 million. NEPA Alliance Business Finance Corporation holds 6 of the 504 loans for $2.4 million. These holders are as SBA records them today and do not describe any institution's practices.

Cancellations and withheld rates

Among FY2017 to FY2024 approvals, cancellation reaches a floor of 9.7%. No ceiling that counts undisbursed loans and no charge-off rate comes with this cell, and both stay unknown.

Testing a northeastern Pennsylvania restaurant

Because the class is so heavily represented, a lender will see many similar proposals, and a study has to explain why this site and concept differ. It should rely on local demand: residents, workers and visitors in the trade area, with attention to seasonality. With a median near $222,500, the likely uses are a lease build-out, equipment or a change of ownership, and the study should say which. Sales per seat, rent and labor should feed a coverage ratio that holds in a slow opening. The appraiser will test sales against comparable rooms. Counties are placed in areas through the July 2023 list.