SBA 504 Hotel Feasibility Study in Florida

Florida hotels under the 504 program

Florida is second in the country on the count of hotel and motel loans financed through the 504 program by number, and hotels hold the third slot among Florida's 39 classes. The file for FY2017 to FY2026 holds 225 loans worth $612.9 million. The median is $2.6 million, 1.29x what hotels borrow at the median nationally under the 504 program, and the central half runs from $1.4 million to $3.9 million. Franchise share is 68.4%. The 504 program pairs a certified development company's long-term fixed-rate piece with a bank's first-lien loan, and the dollar figures in the data block are the gross dollars approved under 504 for these loans, which is the program's share of each financing and not the whole project cost.

A very wide gap in cancellations

Cancellation after approval is at least 14.5% for FY2017 to FY2024 approvals, but 24.3% once loans awaiting disbursement are treated as lapsed. The spread is wide, and it means many Florida hotel approvals were still unfunded when the data were drawn. Hotel projects take time to build, and a lender should not read a pending approval as a closed loan.

No charge-offs so far

Across the 85 disbursed loans, the charged-off share stands at 0.00% to date and at 0.00% for the first five years. That is a real measured number and not a withheld one: none of the 85 had been charged off. It is still a minimum for an unfinished record, and open loans can still be charged off later.

Development companies and counties

The lender table for 504 names certified development companies. Florida First Capital Finance Corporation, Inc. is first with 119 loans totalling $306.8 million, Florida Business Development Corporation 76 worth $218.1 million, Sunshine State Economic Development Corporation 20 worth $52.2 million and Independent Development Services Corporation 8 worth $33.3 million. The counts are loans on each company's books and not a statement of its requirements. Hillsborough County has 23 loans, Pinellas 18, Duval 14, Orange 13, Pasco 12, Polk 11 and Volusia 10, with Escambia, Lee and Miami-Dade at 8 each. Approvals ran from 37 in FY2017 to 11 in FY2021 and 27 in FY2024 and FY2025.

Limits, and what a Florida 504 hotel study has to test

Limited-service and full-service properties are not separated in this record, because hotels and motels are filed together. A study must say which kind it addresses. It must test demand by segment and the competitive set at the exact exit or district, project occupancy and daily rate on a ramp-up, and net franchise fees and the required improvement plan out of income. Storm exposure and the price of windstorm cover belong in the budget. With a median of $2.6 million and a central half reaching $3.9 million, the project cost must be tied to quotes or comparable sales. Repayment must survive occupancy far under the stabilised case, and the appraisal will rest on net income.