SBA 7(a) Car Wash Feasibility Study in Georgia

Big tickets in a crowded field

Georgia car wash lending under SBA 7(a) is notable for how large the typical loan is. SBA approved 166 such loans from FY2017 to FY2026, worth $360.4 million in gross dollars, and the median of $2.2 million is 2.74x what a car wash borrows nationally at the median under 7(a). That ratio is the figure that sets this page apart from the all-program Georgia record and from car washes nationally: the middle half of loans runs from $652,500 to $3.3 million, so a Georgia sponsor is far more likely to be financing a large tunnel site than a small self-serve bay. Franchising plays almost no part, at 3.0% of loans.

Where the loans sit and who holds them

By loan count Georgia stands 4th in the nation for 7(a) car washes, yet car wash is only 13 of 39 among the classes inside Georgia, so this is a specialty the state does well rather than a mainstream line. Fulton and Gwinnett counties each show 22 loans, followed by Cobb and DeKalb with 14 apiece, Forsyth with 10 and Hall with 8. The holders listed by SBA are led by Metro City Bank with 41 loans worth $109.1 million. Celtic Bank Corporation and Georgia's Own Credit Union follow with 10 apiece, Wells Fargo Bank National Association holds 9 and Open Bank holds 6. That list is SBA's own tally of present holders, so it records where loans sit and implies nothing about a bank's current appetite.

Pace and outcomes

Approvals reached 21 loans and $42.1 million in FY2017, rose to 27 loans and $71.8 million in FY2021, and had fallen to 7 loans and $8.6 million by FY2026, a reminder that the pipeline has thinned. Cancellation after approval has a floor of 12.4% on FY2017 to FY2024 approvals, and counting loans that never disbursed leaves the ceiling at that same 12.4%. Charge-offs to date sit at a floor of 3.1% among the 96 early-cohort Georgia washes that disbursed, while the five-year measure shows 0.00%. Open loans can still fail, so both numbers are minimums, and neither is a final verdict on the cohort.

Testing a large Georgia wash

The study behind a Georgia car wash under 7(a) carries a heavier burden than the average file, because the loan is big. It should test traffic counts and competing washes along the specific corridor, the cost of land, equipment and site work against a ticket that may sit well above $2.2 million, and whether wash volume and membership revenue cover debt service with room to spare. The appraisal will value the going concern, so the study's revenue forecast has to hold up when an appraiser capitalizes it. Remember the coding limit: SBA files tunnel, self-serve and mobile operations, and truck washes too, as a single category, and some of these loans may serve a different operating model than the one being proposed.