SBA 7(a) Car Wash Feasibility Study in New York

Nassau and Suffolk lead New York's car wash record

Car wash lending in New York is concentrated in a few counties, and its charge-off floor deserves attention. The 7(a) file for FY2017 to FY2026 shows 94 loans and $107.5 million in gross dollars; New York is 8th nationally on count, though car wash sits at 18 of 39 among its financed industries. The median is $692,500, or 0.88x the national 7(a) median for the class, with the middle half stretching from $82,500 to $1.7 million. The franchise share is 0.00%.

Holders and counties

Heading the holders is TD Bank, National Association with 13 loans; New Millennium Bank follows at 10 and Manufacturers and Traders Trust Company at 7, each a present holder in SBA's file. County by county, Nassau has 14 loans, Suffolk 12 and Queens 10, with Orange at 7 and Erie and Richmond at 6 each. The count fell from 15 in FY2017 to 4 in FY2021, then recovered to 10 in both FY2024 and FY2026.

A charge-off floor to weigh

Car wash cancellations in New York came to 7.8% at the least across the FY2017 to FY2024 vintages, and 7.8% is the ceiling too. The charge-off figures matter most here: among 47 loans from the FY2017 to FY2021 funding years, the floor is 8.5% to date and 4.3% within five years. The rise from the shorter to the longer measure shows that losses kept appearing after the fifth year. Loans still open can add to these floors, and the 47-loan base is small.

Testing a New York wash site

Start with the cars: the passing vehicle counts, how many rival washes within a short drive, and the share of customers likely to buy a membership. Weather must be modeled by month instead of by an annual average. The mix of wash types matters, for equipment cost and water use. Cost has to be explained against a median near $692,500 and, if it goes beyond $1.7 million, by the land and equipment. Environmental rules on water discharge and the zoning of the site should be confirmed before the numbers are trusted. One code lumps passenger-car bays, truck washes and mobile operators together, so every figure here is a blend.