SBA 7(a) Hotel Feasibility Study in Oklahoma

Oklahoma lodging near the national norm

Oklahoma hotels and motels under SBA 7(a) look a lot like the national class. The median of $2.2 million is 0.98x the national figure, which is as close to parity as any cell can come, and the central half of the distribution lies between $1.0 million and $3.9 million. Over FY2017 to FY2026 SBA approved 108 loans for $262.7 million, making lodging third of 39 classes in the state, while Oklahoma is 26th among states by count. Brands appear in 68.5% of loans.

Low cancellations and a late surge

Cancellation after approval is 4.9%, and the ceiling gives the same 4.9%, so counting undisbursed loans adds nothing. For the 48 early loans that funded, a floor of 2.1% has been charged off to date, with 0.00% inside five years. The timing is uneven: FY2017 had only 5 loans and $8.2 million, FY2021 had 20 and $37.1 million, and FY2026 reached 18 loans and $66.9 million, the biggest of the three years in dollars, so recent loans are much larger and have had the least time to season.

Holders and counties

Celtic Bank Corporation holds 7 loans for $20.3 million. Peoples Bank and Trust Company has 6 loans and $14.4 million, Arvest Bank 6 and $4.8 million, and Bank of Hope 5 and $19.1 million, with Readycap Lending, LLC at 5 and $16.9 million. Bank of Hope's average is among the largest. Oklahoma and Tulsa counties each show 20 loans, Carter 10, and Kay, Muskogee and Pottawatomie 4 each, followed by Beckham, Garvin, McClain and Rogers at 3. The two leading counties are followed by a number of smaller ones.

What the study must test

An Oklahoma hotel study should name the kind of property and the guests it relies on. It has to identify the existing rooms in the drive market, test occupancy and rate against comparable properties, and show debt service coverage with a margin, given a ticket near $2.2 million. The franchise's improvement requirements belong in the budget. With recent loans much larger and still unseasoned, a lender will want evidence that demand supports the revenue forecast without optimistic ramp-up. SBA treats all hotels and motels as a single group, so the data cannot separate limited-service from full-service lodging, and the appraisal values the going concern.