SBA 7(a) Fitness Center Feasibility Study in Mississippi

Mississippi gyms: few cancellations, ranks near the top locally

Fitness centers rank 5 of 39 among Mississippi's asset classes under 7(a), a high place that reflects how much of the state's small business lending is gym-sized, even though the state is 39 among states for the class by count. Over the ten fiscal years SBA approved 50 loans worth $15.6 million. The median loan, $266,550, is 1.08x what gyms borrow nationally, with the middle of the book at $108,525 to $420,550. Franchise share is 24.0%. The cancellation floor of 2.3%, with an equal ceiling, is low: few approvals fell through, which is encouraging for a borrower deciding whether an approval will hold.

Holders and counties

Community Bank of Mississippi is the leading holder with 11 loans and $3.5 million, and Peoples Bank next with 7 loans and $1.7 million, both as SBA records current holders. Count the Jackson-area counties together and they carry the class: Hinds at 10 loans, Rankin at 7, Madison at 5. Lauderdale and Pearl River trail at 3 each. Approvals were steady by comparison with other classes: 6 loans and $1.8 million in FY2017, 8 loans and $1.7 million in FY2021, 5 loans and $1.7 million in FY2024 and 3 loans and $470,600 in FY2026.

SBA's data supports no charge-off rate for this cell because of a thin early cohort. We give no number and do not call it zero; a lender should treat the matter as unmeasured.

What a Mississippi fitness study must test

Because memberships recur, the study should show how the facility reaches a member count that covers its fixed cost: population within a short drive, competing gyms and the price points they charge, and the churn that follows a promotional start. Expect to see revenue split between memberships, personal training and classes. A franchise project must state its required equipment package and remodel cycle; an independent studio must show how it will find members without a brand. Equipment is a large share of cost and loses value quickly, so collateral beyond it deserves attention. Seasonality, with January surges and summer drops, should be modelled by month. For the lease, tenant improvement allowance and term matter more than purchase price. The appraisal rests on the business, not the building, so coverage should hold on conservative membership.