SBA 504 Restaurant Feasibility Study in Colorado

The top class in Colorado, financed through development companies

Full-service restaurants rank first among Colorado's 39 asset classes in SBA 504 lending, though the state itself is only 10 on the national count table. Across FY2017 to FY2026 this cell took in 114 loans worth $90.4 million. SBA 504 financing is built for fixed assets such as buildings and long-lived equipment and is arranged through certified development companies, so the lender table on this page names development companies rather than banks. The median loan is $572,500, a ratio of 0.94x to the national 504 figure, and loans in the middle of the distribution run from $360,750 to $1.0 million. Franchise ties are rare at 4.4%.

Development companies and counties

B:Side Capital is shown as the holder of 74 loans worth $56.5 million, by far the largest. Mountain West Small Business Finance holds 20 worth $18.5 million, Preferred Lending Partners holds 13 worth $8.9 million, and Pikes Peak Regional Development Corporation holds 5 worth $2.0 million. These are the organisations SBA records against the loans, and the page offers no view of how any of them operates. Denver County has 16 loans, Boulder and El Paso 12 each, Weld 10 and Garfield 7. Approvals were lowest in FY2019 at 5 loans, jumped to 20 loans and $14.3 million in FY2022, and reached 17 loans and $17.6 million in FY2025.

Outcome floors

At least 9.2% of approvals through FY2024 were cancelled before funding, and 11.5% if undisbursed loans count as cancelled. For 42 funded loans in the early cohorts, no loan has been charged off yet, and the measure reads 0.00% on both horizons. Such a clean showing is encouraging for real-estate-backed restaurant loans, but loans still open can change it.

A Colorado restaurant study for a 504 loan must justify a fixed-asset project, usually a building purchase, construction or major renovation, and show that the concept works at the sales level needed to carry the debt. That means a trade-area analysis for Denver, Boulder or the Front Range resort markets, a menu and check-average build-up, labour costs reflecting local wages, and a realistic first-year ramp. Run the coverage test again with weaker sales, and the study should state how the owner's occupancy of the property is supported by operating income rather than by the real estate alone. The appraisal will value land and building, so the study should show the restaurant could be re-let or sold if it closed. Program terms are SBA's to apply.