SBA 504 Fitness Center Feasibility Study in Wisconsin

Wisconsin fitness centers: one development company holds most of the loans

WBD, Inc. carries 23 of the 31 loans and $22.1 million of $32.3 million in this cell, and Racine County Economic Development Corporation holds 6 loans and $7.3 million, as SBA lists current holders. That concentration is the cell's most distinctive trait, since no metric passes our margin test. The median loan of $812,000 is 1.03x the nationwide 504 figure, and a typical gym loan lands from $243,000 to $1.2 million. Franchising is 9.7%. The state is 9 among states on loan count, with fitness taking slot 12 of 39 among Wisconsin's classes, so gyms are a regular but not leading user of 504 here.

Where and when

Dane County has 7 loans, Outagamie 3, and Brown, Fond du Lac, Milwaukee, Ozaukee and Racine 2 each. Approvals were uneven: 4 loans and $1.2 million in FY2017, 6 loans and $7.9 million in FY2022, 1 loan each in FY2023 and FY2024, then 4 loans and $8.6 million in FY2025 and 5 loans and $5.8 million in FY2026.

Cancellation and charge-off stay off this page for Wisconsin gyms, the loans being too few; unprinted does not mean zero.

A 504 fitness study

Because 504 finances fixed assets, a gym that draws on it in Wisconsin most likely owns or is constructing its premises, so the study must price the real estate: land, construction or conversion, parking, and the floor area the club needs. Membership is the revenue base. Show the number of members the club needs to carry both loans, the catchment within a short drive, competing gyms and what they charge, and the churn assumed. Seasonal demand matters in a cold-winter state, with strong winters and weaker summers, and the model should show month by month. Equipment is a significant cost and a depreciating one, so lenders look at the real estate for security. If the borrower plans to lease surplus space to a tenant, such as physical therapy or a cafe, the study should show that income separately. Appraisal will value the building as a fitness facility, and the study should note alternative uses, the insurance and maintenance cost of pools or saunas if any, and the staffing plan for front desk and trainers.

With 1 loan in each of FY2023 and FY2024 and 5 in FY2026, annual counts are too small to read as a trend. A Wisconsin study should rely on the site: its membership potential, the competing clubs near it, and the cost of the building, instead of citing the state's lending history as proof.