SBA 504 Self Storage Feasibility Study in Texas

What Texas records for SBA 504 self storage loans

On self storage projects in Texas, SBA logged 60 approvals, $91.4 million in gross dollars, in Texas under 504 across FY2017 to FY2026. In a state-by-state ordering of SBA 504 self storage loan counts, Texas lands at 5; within Texas itself, this class holds 9 of 39 across the asset classes. Usual size: $1.3 million. Compared with SBA 504 self storage loans nationwide, Texas runs at 1.42x on the median, a bigger ticket profile. From $667,000 up to $1.9 million sits the middle half of the loans in Texas. 3.3% of these Texas loans went to franchised businesses. The $1.3 million median is where Texas self storage clients under SBA 504 differ from each comparison group, the class across programs in Texas and the class under SBA 504 nationwide.

The lenders and places behind Texas's self storage loans

The certified development companies holding the most Texas self storage loans are Capital Certified Development Corporation (19 loans, $24.5 million), LiftFund, Inc. (10 loans, $16.3 million) and Texas Certified Development Company, Inc. (10 loans, $13.7 million). The Texas self storage ranking follows whoever owns each Texas loan; the original lender of those 19 loans can differ. By county, Harris with 8, Bell with 4, Brazoria with 3 and Collin with 3 top the self storage approvals in Texas. Year by year in Texas, FY2026 was the high point, with 9 loans worth $20.0 million, while the first year of the series, FY2017, had 5.

Texas: floors for cancellation and loss, with one self storage coding caveat

For FY2017 through FY2024, 22.2% or more of Texas self storage approvals were cancelled after approval; a ceiling, adding undisbursed loans, is 33.3%. On Texas self storage loans funded from FY2017 to FY2021, among those 60 loans too few ended in charge-off to publish a rate, so we leave that Texas rate out, and its absence does not mean zero losses for this asset class. Every Texas self storage rate above is a minimum, since undisbursed self storage loans among the 60 may yet fail. Bear this caveat when reading Texas's 60 loans: Texas's total comes with one reservation: boat and RV storage sit under an identical classification as indoor units or general storage.

The work behind a Texas self storage loan application

Because the 60 Texas approvals here are 504 financings that pair a Texas certified development company with a separate senior self storage lender, each is built around owned Texas real estate and long-lived self storage equipment, and the study has to show an owned self storage project that can support both layers of debt. The demand test for storage in Texas starts from the catchment: household growth, multifamily density and the pace of competing facilities were delivered. Build cost, grading and drainage and the mix between ground-level and climate-controlled space needs to be tested against Texas conditions before any rate is assigned. Test the Texas self storage numbers at the $1.3 million median plus at $1.9 million: coverage which holds only in the good case will not be persuasive. An appraiser will capitalise stabilised net income after allowing for the lease-up period, and the fill curve in the study must be supportable. A borrower that is approaching Capital Certified Development Corporation can read its 19 loans here as background only: SBA's numbers show a book, not its terms.

Loan Analytics reads the 60 Texas approvals as SBA's Texas records, not a forecast for any self storage project; a self storage study signed by Daniel Smith, MAI, tests Texas conditions first, and Texas approvals promise nothing.