Restaurant Feasibility Study in the Sioux Falls, SD-MN Metro Area

Sioux Falls: restaurants with a large 504 share

Sioux Falls counts 42 full-service restaurant loans, split 24 to 18 between 7(a) and 504, a far bigger 504 share than most restaurant metros show. SBA lists $23.4 million approved, and the median of $403,500 is 1.47x the national figure. The quartile edges are $182,050 and $724,000. Restaurants lead locally at 1 of 39, though a location quotient of 0.80x sits under the national weight, and the metro places 115 of 821 nationally.

Independent, property-owning operators

Franchise share is 14.3%, so most borrowers are independent. Minnehaha County, SD carries 33 loans. The large 504 share suggests many operators finance buildings, not only fit-out. Dakota and Minnesota diners both reach the city, which widens the draw but also adds competing corridors.

Holders

Dakota Business Finance and The First National Bank in Sioux Falls each appear as holder of record on 12 loans, with $7.9 million and $4.4 million respectively, and First Bank & Trust on 5 loans worth $2.6 million. These are SBA's tallies, and Dakota Business Finance may hold 504 loans; they offer no view of any institution. FY2018 printed 5 loans and $1.7 million, FY2022 6 and $3.6 million, FY2023 5 and $2.1 million, FY2025 5 and $3.6 million, and FY2026 6 and $4.3 million. FY2017, FY2019 to FY2021 and FY2024 are withheld.

Gaps

For Sioux Falls restaurants neither cancellation nor charge-off is published, and a blank is not a zero. A Minnehaha County loan counts in Sioux Falls through its county name in the 2023 list.

Where a Sioux Falls restaurant study should look

Sioux Falls draws from a wide regional trade area, so a study should test where diners actually come from and how winter weather shapes traffic. Because many borrowers own their building, ask whether the project buys or leases and test both. Cost work covers kitchen, dining room and any site work. Run coverage at $403,500 and near $724,000, and have the appraiser value the real estate, equipment and going concern on separate lines. Staffing in a low-unemployment market, and the competing chains along the main commercial corridors, round out what a lender will want to see.