Restaurant Feasibility Study in the Virginia Beach-Chesapeake-Norfolk, VA-NC Metro Area

Hampton Roads restaurants: more 504 than most

The Virginia Beach-Chesapeake-Norfolk area records 80 restaurant loans of the sit-down kind across FY2017 to FY2026, worth $39.7 million. The class is second of 39 locally, the area is 65 of 821 for the category, and the location quotient of 0.82x puts restaurants under their national share. The median loan of $355,600 is 1.29x the national midpoint, and loans between the quartiles run $121,225 to $610,000. The program mix is the notable feature: 7(a) carries 62 loans and 504 carries 18, a sizeable real-estate share.

Holders, brands and places

Truist Bank is listed with 10 7(a) loans worth $7.2 million, The Huntington National Bank with 8 worth $4.5 million, Newtek Bank, National Association with 6 worth $855,000 and Fulton Bank, National Association with 5 worth $5.0 million. No 504 holder reaches the threshold for being named. Franchised stores hold 20.0% of loans. Virginia Beach city has 23 loans, Norfolk city 15, Chesapeake city 11, and Currituck, NC and Newport News city 7 each, so the area crosses a state line. Those are SBA's entries on holders, with no reading of any lender's stance.

Steady, small annual volume

Annual counts are low and steady, from 5 loans and $3.0 million in FY2021 to 11 loans and $4.8 million in FY2018, with 10 loans and $2.8 million in FY2026. No printed year passes $5.8 million in dollars, which keeps this a market of mid-sized independents and not of large projects.

Unpublished outcomes and the study

Hampton Roads shows blanks where the cancellation and charge-off rates would go, because the cohort is small, and a blank never stands for zero, so the record offers no way to judge how these loans fared after approval. A restaurant study in Hampton Roads has to test the seat demand across a market with its own seasonal swings, the competing supply on the corridor, fit-out or purchase cost set beside loans near the median, the case for using 504 to buy the property, and debt service coverage. An appraisal should keep real estate apart from the business. A project county outside the 2023 metro map's list of names falls outside the area.