SBA 7(a) Gas Station Feasibility Study in Alabama

Two distinctive facts: size and cancellation

Alabama's SBA 7(a) gas station loans differ from the class nationally in two ways. The median loan of $700,000 is 0.64x of the national 7(a) median for gas stations, a notably smaller ticket, and 28.1% of the earlier approvals were cancelled, a figure the cell's own ceiling leaves unchanged at 28.1%. The file counts 44 approvals from FY2017 to FY2026 and $38.6 million in gross dollars. Half of loans run from $308,750 to $1.2 million.

Franchise brands and rank

A third of Alabama's gas station loans, 34.1%, carry a franchise, which at fuel retail means a branded supply contract. Alabama is 30 nationally by count, while gas stations take 9 of 39 at home. In the lender table, Northeast Bank accounts for 7 loans and $1.9 million, and Metro City Bank for 5 loans and the larger $6.5 million, so the second lender's loans are bigger on average. Jefferson County has 10 loans and Mobile has 7; Cullman and Tallapoosa have 4 each.

A choppy series

Annual approvals were 12 in FY2024 with $10.9 million, after only 1 in FY2018 and 1 in FY2019, and FY2020 produced 7 loans and $11.0 million. Lumpy years suggest a handful of large deals moving the totals.

Scope and the missing rate

The industry code describes the borrower, so a travel center is counted among stores that sell only fuel, and charging stations are not named in the index at all. The charge-off rate is withheld, not zero, since the early funded cohort lacks enough loans.

Testing an Alabama fuel site

The study should open with the site's traffic and access, rival pumps along the same road, and the supplier's contract terms. It must estimate gallons, the margin per gallon, and the revenue from the store, and it should show what happens to coverage if fuel prices swing. With nearly three in ten approvals cancelled, buyers and lenders should expect environmental and title conditions to matter: a Phase I review of tanks, a plan for removal or upgrade, and the zoning for the pumps. The appraisal of a gas station rests on a going-concern income and the land beneath it, and the study should split the two, because a median ticket of $700,000 may hide a high land share.