Restaurant Feasibility Study in the Stockton-Lodi, CA Metro Area

Full-service restaurants around Stockton and Lodi

Stockton-Lodi, CA places full-service restaurants 3 of 39 among its classes. The area logged 35 loans worth $29.5 million in FY2017 to FY2026 and stands 136 of 821 nationally for the class. A location quotient of 0.62x says restaurants are a thinner slice of Stockton lending than of lending across the country. Against that, a median loan of $418,000 is 1.52x the class's median nationally, so the restaurant loan here is bigger than the typical one elsewhere.

Loan sizes, programs and franchises

Half of the loans fall between $76,450 and $863,000, running from a small equipment loan to a purchase of a building. SBA 7(a) accounts for 30 loans, SBA 504 for 5, and 20.0% of the loans carry a franchise brand. San Joaquin County, CA records all 35. Only U.S. Bank, National Association reaches the threshold for printing, at 5 SBA 7(a) loans and $1.3 million.

Two years print. FY2017 shows 7 loans and $7.1 million. FY2022 shows 0 loans and $0, so no loan was approved that year. Other years are hidden for lack of loans, and hidden does not mean none. Nor are cancellation and charge-off rates printed, since the cohort is below the 30 loans Loan Analytics demands for a rate. To be counted in this area, a loan needs a project county that sits on the July 2023 list, and a county that cannot be placed there takes its loans out of the count.

Testing a restaurant in the Stockton market

A low local share paired with a high median suggests projects that are individually large, and a study should test whether the restaurant in question is one of them. It has to show the covers and average check a realistic trade area supports, labour and food cost on a conservative base, and build-out or purchase cost set against a $418,000 loan, and a slow first year that still pays the lender. With so wide a middle range, any lender will press the question of whether the loan is for equipment, leasehold work or property, and the appraisal has to follow that choice. Seasonal swings, delivery platforms and the pull of the nearest competing dining rooms all belong in the revenue forecast, with each assumption tied to a source a lender can check.