Self Storage Feasibility Study in New Mexico

More self storage than the nation, in bigger loans

New Mexico leans on self storage in SBA lending more than most places. The location quotient is 2.27x, meaning storage is more than twice as heavy a share of the state's approvals as of the national book, and the 25 loans from FY2017 to FY2026 total $40.0 million. By number of loans the state still ranks only 31 of 50, and storage ranks 14 of 39 among New Mexico asset classes, because the state's whole SBA volume is small.

A sizeable ticket

The median loan of $1.3 million comes to 1.35x the class median nationally, while the middle half runs from $660,000 to $2.1 million. That is a high floor: very few of these were small. Of the 25, 17 used 7(a) and 8 used 504, a notable weighting toward 504, the program built for owner-occupied real estate and long-term fixed-asset financing. None of the loans was franchised, at 0.00%. The pattern reads as facility purchases and new construction by owner-operators.

Lenders, counties and years

In the 7(a) listing, Live Oak Banking Company shows 9 loans and Western Commerce Bank 5; these are holdings as SBA reports them and carry no judgement of either lender. Bernalillo County has 11 loans, and Otero, San Juan and Santa Fe have 3 each. The biggest year by dollars was FY2017, at $9.8 million from 3 loans, and FY2023 had none.

A shared code and withheld rates

Recreational vehicle and boat storage have no code of their own: the filing is either self storage or other warehousing, so some of the volume may be vehicle storage and some boat yards may sit outside the figures. Neither loss rate is printed for New Mexico storage, given cohorts too small for a percentage; absent is not zero.

What a New Mexico storage study has to test

The study must prove demand by counting households, apartments and businesses within a few miles, and it must inventory the storage already built, since an over-indexed state may already be well supplied. It should test rental rates by unit type, the pace of lease-up and the stabilised occupancy against debt service on a loan in the million-dollar range. Land, construction and site work should be compared with the median ticket shown here. The appraisal will be performed on the income approach, so the study must carry a reasoned rent roll, and a downside case should show coverage if lease-up slows.