SBA 504 Hotel Feasibility Study in Connecticut

Connecticut hotels: the biggest tickets and the top local rank

Connecticut hotels are the largest borrowers among the cells on this stretch of the program. The median loan of $3.2 million is 1.57x the nationwide 504 figure, which our test marks as distinctive, and the interquartile band opens at $1.9 million and top out at $4.8 million. The 37 approvals carry $120.0 million in gross dollars, and the class ranks first among the 39 classes in Connecticut, though the state is 27 among states by loan count. Franchise brands account for 62.2% of loans. Put together, the cell describes a small number of expensive, mostly flagged properties in a state where lodging dominates this program.

New England Certified Development Corporation at the center

New England Certified Development Corporation is credited with 23 loans and $78.2 million, and Community Investment Corporation with 6 loans and $18.5 million, in SBA's records of current holders. The area labels here are planning regions: Southeastern CT has 11 loans, Western CT 7, South Central CT 6 and Capitol 3, with a handful elsewhere. Approvals strengthened over time. The early years show 2 loans a year with $5.1 million in FY2017, and 1 loan of $377,000 in FY2020. By FY2023 through FY2026 the count was 6 loans in each year, with $18.1 million, $21.8 million, $25.4 million and $23.4 million.

Outcome measures are absent here, and with no rate to quote we leave the question open. A reader should not translate either blank into zero, and a lender looking for loss evidence should turn to the national hotel class under 504.

What a Connecticut hotel study must prove

Hotels and motels share one code, so limited-service inns and full-service properties are mixed in these figures, and the study must state which it is. With a typical ticket in the millions, the project is likely an acquisition or a substantial build, so cost must be itemised: land or purchase price, construction or renovation, furniture and equipment, and the franchise's property improvement requirements. Market evidence should rest on competing properties within the same travel corridor, their rates and occupancy through the year, and the sources of demand, whether business travel, universities, casinos, events or leisure. Coverage must be tested in a stabilised year and in a downturn year, each carrying the two debts a 504 borrower owes. Appraisal will price the going concern, so the study should split real estate, brand and business value.