SBA 504 Dental Office Feasibility Study in Texas

Texas dental offices borrow at 1.29x the nationwide 504 dental median, with a median of $771,500 and a middle half between $611,750 and $1.3 million. Across 36 loans the cell has $37.3 million. Texas is ninth for dental loans when counted nationally, but dental offices are only 12 of 39 inside Texas, so the class matters less in the state than the ratio might suggest. No loan was franchised.

Three companies, one outsized average

Capital Certified Development Corporation holds 14 loans and $10.2 million, Greater East Texas Certified Development Company 6 and $11.3 million, and LiftFund, Inc. 5 and $3.1 million. The East Texas company has fewer than half the loans of the first, yet more dollars, so its average loan is much larger; it appears to hold the large dental builds. The tallies are SBA's records of who holds the paper and nothing more. Bexar County has 6 loans, Travis 5, Williamson 4, Harris 3, and Collin, Denton and Fort Bend 2 each.

Timing

Counts ran 2, 5, 2 and 3 from FY2017 to FY2020, then reached 10 in FY2021 at $6.5 million and 6 in FY2022. No loan was approved in FY2023, FY2024 had 4, FY2025 had 3 at $6.5 million, and FY2026 only 1 loan at $96,000. A cancellation floor of 18.8% applies to approvals through FY2024, and counting undisbursed loans raises the ceiling to 21.9%, a close pair that indicates few approvals remained open.

The loss rate

The charge-off rate is not shown, as the number of funded loans is too small to publish it.

A Texas dental building study

Because 504 finances the real estate, the study should test whether the dentist owns the building, how much space is leased to other tenants, and the cost per square foot against comparable medical buildings. It should model the patient base from the surrounding households and competing offices, the number of operatories, the insurance mix, and the pay of hygienists and associates. Run both loan pieces through a case with collections under plan, and have the appraiser state a value for the building if it were let as general medical or office space.