SBA 504 Hotel Feasibility Study in Missouri

Size, rank and loan sizes of Missouri hotel and motel lending under SBA 504

SBA's files show 51 approvals under 504 for hotel and motel projects in Missouri from FY2017 and FY2026, worth $101.5 million. Missouri's hotel and motel volume under SBA 504 stands 21 nationally on loan count, and hotel and motel sits 1 of 39 within Missouri's asset classes. Typical size: $1.9 million. Relative to hotel and motel (SBA 504) lending nationwide, Missouri runs at 0.92x on that median, a more modest ticket profile. Half of all Missouri loans fall from $875,500 to $2.5 million. The franchise share of Missouri loans is 74.5%. Across the 51 Missouri hotel and motel loans, neither the $1.9 million median nor any other metric departs sharply from the wider benchmarks, which is why Missouri's lenders, counties and years carry the hotel and motel page.

For Missouri hotel and motel: lenders and local spread

The certified development companies holding the most Missouri hotel and motel loans are Rural Missouri, Inc. (31 loans, $56.6 million) and St. Charles County Economic Development Council (9 loans, $24.4 million). The Missouri hotel and motel table follows whoever owns each Missouri loan; the originator of those 31 loans can differ. By county, Saint Louis with 10, Taney with 10, Camden with 3 and Cooper with 3 lead the hotel and motel loans in Missouri. Year by year in Missouri, approvals peaked at 9 loans, worth $10.1 million, in FY2017, and the series closes at 4 loans and $8.5 million in FY2026.

Missouri: floors for cancellation and loss, with one hotel and motel coding caveat

For FY2017 to FY2024, 15.9% or more of Missouri hotel and motel approvals were cancelled after approval; the more generous count, with undisbursed loans, reads 22.7%. On Missouri hotel and motel loans disbursed in FY2017 to FY2021, the cohort of charge-offs drawn from those 51 loans is statistically thin; we give no Missouri number, and a zero should not be inferred for hotel and motel. Readers should take these Missouri rates, drawn from 51 loans, as minimums, not as settled outcomes. The class carries a classification limit worth noting in Missouri: one industry code serves hotels and motels, and Missouri select-service plus full-service projects are counted together in these counts.

Testing a Missouri hotel and motel loan application

A Missouri hotel and motel deal under 504, one of 51 on record, places two institutions behind the project, a certified development company alongside a conventional lender, so the hotel and motel study is tested on total payments and on the sponsor's contribution in Missouri. A Missouri hotel and motel feasibility study builds a set of comparable hotels and tests whether the market has room for more rooms. Flag standards, renovation cycles and pre-opening outlays must be priced in the Missouri project. The coverage test runs at $1.9 million and as well at $2.5 million, with a slower case, so a Missouri lender sees where hotel and motel coverage narrows. Hotel valuations rest on mature revenue per room and operating margin, and our forecast must give a ramp-up path the appraiser can accept. A borrower who approaches Rural Missouri, Inc. needs to use its 31 loans here as perspective only: SBA's figures show loans, not any requirements.

Daniel Smith, MAI, signs the Missouri hotel and motel study: the $101.5 million authorized before is orientation, while the hotel and motel study itself tests the local issues; Missouri approval is never promised here.