SBA 7(a) Fitness Center Feasibility Study in Arizona

Arizona gyms: third-ranked in the state, heavily franchised

Fitness centers hold third place among Arizona's 39 classes, and the state ranks 16 among states for 7(a) loans to the class, with 285 approvals from FY2017 to FY2026 worth $117.1 million. Franchised units account for 53.3% of loans, so most borrowers buy into a system. The median loan of $290,000 is 1.18x the nationwide benchmark, and typical Arizona loans run from $109,000 to $522,500. The ratios do not separate this cell from its parents, so the page works as a plain profile of a franchise-led market.

Concentration by lender and place

Holder counts fall steeply: The Huntington National Bank has 36 loans at $11.8 million, then come Wells Fargo Bank National Association with 18 at $6.5 million, Midwest Regional Bank with 15 at $4.3 million, Arizona Capital Source with 13 at $2.0 million and Zions Bancorporation, National Association with 12 at $6.4 million. Maricopa County overwhelms the geography with 239 loans; Pima has 25, Yavapai 7, Coconino 4, Cochise 3, and Graham, Mohave and Pinal 2 each, with Yuma at 1. A gym outside Phoenix will find few local precedents in this record.

Outcome floors

The charge-off numbers are the heaviest part of the record. Of the 117 loans that funded between FY2017 and FY2021, a floor of 8.5% has already been written off, and 6.0% failed inside five years of approval. The cancellation floor is 11.0% for approvals through FY2024, or 12.8% when loans still undisbursed count as cancelled. Open loans can add to each.

What an Arizona fitness study must establish

Membership economics drive everything. The study should show how many members the club needs at its planned price to cover rent, staff, equipment leases and debt, how fast joiners accumulate, and how many leave each month. It should map competing clubs and budget chains within reach, test the franchisor's required fit-out against the budget, and compare the total with a ticket near $290,000. Because the loss floors are high, include a downside in which membership stalls well short of plan. Gym equipment holds little resale value, so an appraisal will center on business value and the lease. The study should also state the lease term, renewal options and any landlord contribution to fit-out.