SBA 7(a) Restaurant Feasibility Study in New Hampshire

Small independent restaurants in the leading class

In New Hampshire, full-service restaurants lead every other class for SBA 7(a): 1 of 39. The program approved 257 of these loans between FY2017 and FY2026, worth $58.3 million, though the state stands only 29 among states. The $100,000 median is just 0.41x of the national 7(a) median for full-service dining, and the central half of tickets runs from $50,000 to $225,000. Franchise brands account for 1.2% of loans, so this is almost wholly a market of local owners.

Strong credit performance

The outcome floors are low: 9.7% of approvals through FY2024 were cancelled, or 11.1% counting undisbursed loans. Of 128 loans in the funded cohort, the floor on charge-offs is 3.1% so far, and 0.78% inside five years of approval. Funded loans still open can add to them, so no lender should treat them as final, but they are modest in the plain sense that fewer approvals fell away and fewer funded loans failed early. Volume peaked at 47 loans in FY2018, fell to 16 in FY2021, and reached 29 loans and $10.7 million in FY2025.

Banks and counties

Eastern Bank has 28 loans worth $4.8 million and TD Bank, National Association 27 worth $4.5 million. Primary Bank has 16, Meredith Village Savings Bank 15 and Camden National Bank 14. The entries are taken from the SBA field for present holders; they show who holds the paper, not what any bank looks for. Rockingham County has 76 loans, Hillsborough 59, Grafton 35, Strafford 24 and Carroll 18, so the lakes and White Mountains regions matter alongside the southern tier, with Coos at 4 and Sullivan at 3.

The New Hampshire restaurant test

The dining room has to earn its keep in two seasons: leaf-peeping and ski traffic, and the quiet months between. A study should model monthly sales, not annual averages, and show labour costs and food costs at both levels. It must test the competing restaurants within a short drive, parking, the septic and water capacity many rural sites rely on, and the liquor licence. With small loans, a lease long enough to recover the improvements matters as much as the equipment list. Debt service coverage should hold in the weakest quarter, and an appraiser will treat the business and the building separately. If the borrower owns the property, the study should split rent the business can afford from the return the real estate must earn, since the two can point to different conclusions about whether the loan is sized correctly.