Warehouse Feasibility Study in Florida

A top state for a modest class

Florida ranks 3 of 46 states for warehouse and distribution loans, a high standing for a class that is only 26 of 39 within Florida itself. SBA approved 50 such loans across FY2017 to FY2026, worth $58.5 million. The location quotient of 0.94x says the sector holds close to its national share, and the median of $715,500 is 1.43x what a warehouse loan is nationally at the middle. Loans in the middle half run from $300,000 to $1.3 million. No outcome measure is singled out against the class nationally or Florida's record across classes, so the useful reading is the rank and the lender pattern.

A 504-led cell

The 7(a) program carried 36 loans and 504 carried 14, and one development company leads: Florida First Capital Finance Corporation, Inc., with 10 loans and $10.2 million. On the 7(a) side no lender reaches the listing line. Franchises are 4.0% of loans. Miami-Dade County has 12 loans, Saint Johns has 7, and Broward and Manatee have 3 each, so the record is concentrated in a few counties.

Year to year and cancellations

FY2018 had 4 loans yet $9.1 million, FY2023 had 7 loans and $9.0 million, and FY2017 was the smallest year with 2 loans and $2.6 million. Cancellation has a floor of 19.5% for approvals through FY2024, and a ceiling of 24.4%. The gap between the two shows that a share of loans had still not disbursed. No charge-off rate is printed, since the funded cohort is below 30 loans.

What a Florida warehouse study must test

The study should begin with the tenant or the user. Is the building spec space, a build to suit, or a facility the borrower will operate itself? Demand evidence includes vacancy and lease rates for comparable buildings, access to highways and ports, and the clear height, loading docks and power the likely users require. The budget has to cover land, entitlement, site work and the cost of building to current code. Coverage ought to be run through a lease up period and again at a lower rent. The appraisal will depend on market rent and cap rate, and a study should present both.

A coding limit

The class covers public warehousing only. Warehouses owned and used by firms in other industries are coded to those industries, so this cell understates the warehouse stock.