SBA 7(a) Gas Station Feasibility Study in Minnesota

Smaller loans than the rest of the country

Minnesota's gas stations and truck stops show up in 124 SBA 7(a) loans, $85.5 million approved in all. Minnesota is 11th among states for the pairing, with stations and truck stops placed 10 of 39 in its own class ranking. The distinctive metric is the median, $514,000, only 0.47x what the same class borrows nationally. Half of Minnesota's loans fall between $128,000 and $986,500. Franchise brands sit behind 29.0% of the loans. A request near $986,500, the top of the middle half, should show how it differs from the typical Minnesota station.

Sunrise Banks National Association is first with 10 loans, United Prairie Bank next with 9, Security Bank USA with 8 and Old National Bank with 5. These holder counts come from SBA's file; they indicate where loans sit now, never what any bank requires. Hennepin County has 18 loans and Anoka 14, while Beltrami and Dakota show 8 each and Ramsey and Saint Louis 7. Kandiyohi and Otter Tail record 6 apiece. The year 2021 was an outlier at 34 loans and $14.8 million, against only 5 loans in FY2023.

Cancellation and charge-off floors

At least 12.5% of approvals made in FY2017 through FY2024 were cancelled, and adding undisbursed loans moves nothing. Of the 74 loans that went on to fund, the FY2017 to FY2021 group, charge-offs have reached a floor of 1.4%, and that 1.4% also marks the five-year mark. That base of 74 loans is small, so read the 1.4% as a floor on a limited sample. The cancellation floor is the figure to plan around, since a meaningful share of approved station deals never close.

Format first, then the fuel economics

Here the code follows what the borrower itself does, which means a travel center cannot be pulled apart from an ordinary pump-and-store site; charging for electric vehicles does not appear in the 2022 NAICS index, and truck plazas share their industry code with stations that sell fuel only. A Minnesota study must therefore state the format: fuel volume, convenience-store sales, food service and any diesel business. It should test the site's traffic corridor, fuel margins and competitor pricing, then cover environmental conditions on tanks and soil. Show debt service coverage at lower fuel volume as well as at base volume. An appraisal values station, land and business together.