SBA 7(a) Child Care Center Feasibility Study in Kansas

Johnson County is the Kansas child care market

Child care centers financed under SBA 7(a) in Kansas cluster in one county. Johnson County accounts for 40 of the 58 loans approved from FY2017 to FY2026, while Wyandotte has 4, Barton 3, Sedgwick 3 and Pottawatomie and Shawnee 2 each. Together the loans total $42.5 million. A median of $359,600 is 0.93x what centers borrow nationally under 7(a), and the middle half runs from $151,875 to $892,500, a wide band because centers range from conversions to purpose-built sites. Franchising reaches 27.6% of loans. Kansas ranks 32 among states by count, and child care places 9 of 39 among the state's classes. No distinctness basis is recorded for the cell.

Holders and timing

The lender table names Wells Fargo Bank National Association, with 7 loans and $4.7 million, as SBA records the current holder. Approvals were lumpy: 4 loans and $1.4 million in FY2017, then 8 loans and $12.7 million in FY2018, a year whose dollars look large against its count, and 10 loans and $4.8 million in FY2019. They fell to 2 loans and $504,000 in FY2023 and recovered to 7 loans and $8.5 million in FY2026.

Cancellation after approval for FY2017 to FY2024 approvals is at a floor of 4.3%, with the same ceiling. Of the 33 loans that funded early enough to be tracked, 3.0% show as charged off so far, though the five-year measure is 0.00%, which means the losses so far arrived later than the fifth year. Treat both as floors, because open loans can still be charged off.

Kansas centers: reading the code, then the test

The industry code behind this class also sweeps in home-based family care, so these figures cannot isolate centers alone. A feasibility study for a Kansas center should test enrolment demand by age group in the trade area, the licensed capacity the building allows, and the supply of competing centers. Staffing is the central cost, and ratios set by licensing rules drive how many teachers each classroom needs, so payroll should be built from capacity rather than guessed. Tuition has to be tested against what local families can pay, and a ramp-up to full enrolment should be modelled with a slow case. A conversion needs a cost estimate for safety upgrades, outdoor space and parking. The appraisal will value the building and its licensed use, so the study should connect income to the real estate.