SBA 7(a) Hotel Feasibility Study in South Carolina

Brand-dominated and large

South Carolina's hotel loans under 7(a) are overwhelmingly branded: the franchise share is 81.3%. The file for FY2017 to FY2026 holds 267 loans worth $673.5 million. The median is $2.4 million, 1.07x the national figure for the program, and the central half spans $1.4 million to $3.5 million. The state is eleventh by count, and on the state's list of 39 classes hotels hold second place, a high place that shows lodging matters to this program in the state.

One lender stands out

GBank is the leading lender, with 60 loans and $167.7 million, well ahead of PromiseOne Bank with 16 loans and $32.1 million, The Huntington National Bank with 15 and $35.8 million, Peoples Bank with 14 and $48.4 million, and Embassy National Bank with 12 and $17.2 million. A borrower in South Carolina will therefore often meet a lender who has written many hotel loans. The table lists portfolios and does not describe how any lender decides.

A spread of small counties

The county table is flat. Lexington has 20 loans, Orangeburg 19, and Colleton, Horry, Richmond and York 18 each, with Florence at 17, Jasper at 16, and Charleston and Sumter at 13. The pattern suggests highway-exit properties across many small markets rather than a few big resort ones. Approvals ran at 40 in FY2017, 39 in FY2021, then 14 in FY2022 and FY2024, before recovering to 28 in FY2025.

Losses

Cancelled approvals from FY2017 to FY2024 total 9.1% or more of the group, with no difference when undisbursed loans count as cancelled. Of 155 loans disbursed between FY2017 and FY2021, 1.3% are charged off to date and none, 0.00%, went inside five years. These are light numbers, and minimums, for a class where a single failed property is expensive.

Property type, brands and storms

Limited-service and full-service properties are mixed in the 267 loans because the industry code is shared by hotels and motels. A South Carolina study should therefore state which type it addresses. It must test the demand drivers for that exact location, such as highway traffic, golf and beach tourism, military and industrial visitors, and the competing properties at the same exit. With brand affiliation so common, the study has to net franchise fees, the required improvement plan and reservation costs out of revenue and show the brand's own penetration data. Storm exposure and wind-cover premiums belong in the budget. Compare the project with a $2.4 million median, and explain anything near the $3.5 million top of the central half. Repayment must survive occupancy below the stabilised level.