SBA 7(a) Self Storage Feasibility Study in North Carolina

North Carolina self storage: big loans, one lender

North Carolina ranks 2 among states for SBA 7(a) self storage loans, with 116 approved between FY2017 and FY2026 for $181.7 million in gross dollars. Self storage stands 11 of 39 in the state. The median loan of $1.1 million is 1.11x the nationwide figure, and the central half ranges from $585,750 to $2.1 million. Franchising reaches just 3.4% of loans. The distinct feature is concentration of capital: Most of the cell sits on one balance sheet: Live Oak Banking Company, with 69 loans and $140.2 million. Bank Five Nine follows with 11 loans and $6.5 million, First Community Bank with 7 and $2.5 million, and Pinnacle Bank with 6 and $9.3 million.

Counties and years

The geography is dispersed, with no urban core: New Hanover has 7 loans, Brunswick and Gaston 6 each, Forsyth and Wilkes 5 each, and a long tail of counties at 4. Mecklenburg shows only 4. Annual dollars moved widely, from $9.0 million on 4 loans in FY2018 to $32.8 million on 18 loans in FY2021, and FY2026 closed at 9 loans and $15.7 million. Because the cell is so lender-concentrated, it reflects one institution's underwriting appetite as much as state demand, a point a borrower should keep in mind.

North Carolina storage loans approved in FY2017 through FY2024 had at least 6.6% fall out before funding, and counting undisbursed loans changes nothing. The funded FY2017 to FY2021 cohort has 53 loans and shows no write-off so far, 0.00%, nor within five years, 0.00%. These are minimums on a modest cohort, and newer storage loans have had little time to season.

Testing a North Carolina storage request

Boat and RV storage has no code of its own at SBA, so it is mixed into the record. For a North Carolina project, the study must test what the loan size implies: either ground-up construction, with land, site work and buildings, or the purchase of a stabilised facility. It should measure supply in the trade area, since storage capacity per household is a local competitive fact, and current rental rates, occupancy trends and expected lease-up, with a slow-fill case. Payments must be covered before the facility stabilises. The appraisal should rely on income capitalisation and compare the sale price with the replacement cost.