Warehouse Feasibility Study in Texas

Texas warehouse lending is third in rank, below average in focus

Texas is third among 46 states in warehouse and distribution loans, with 50 loans and $76.4 million approved across FY2017 to FY2026. The location quotient of 0.94x confirms its share is a touch under the national share. The class is 26 of 39 among Texas's financed classes, so warehouses are a small part of SBA credit here. The median of $782,750 is 1.57x what warehouses borrow nationally, and half of Texas loans sit between $301,625 and $2.3 million.

What the code leaves out

Only public warehousing is counted. A Texas business that builds a distribution facility for itself is filed under its own industry and is invisible here. That helps explain why the count looks small.

Franchise share is 0.00%, so the file holds no franchised warehouse loans. Of the 50 loans, 39 are SBA 7(a) and 11 are SBA 504, and no lender reaches 5 loans, so the market is spread across many institutions. Harris County has 14 loans, and the next counties, Dallas and Rockwall, have 3 each. Harris County is the center of the file, and a study for a project outside Harris County will find little local history. Cancellation is 20.0% as a floor and 20.0% as a ceiling, so many Texas approvals never funded, and a charge-off rate cannot be printed, since the seasoned cohort is under 30 loans.

What a Texas study must test

Demand testing should be submarket specific: vacancy, absorption of new space, tenant credit and access to ports, rail and interstates. Cost has to cover slab and dock work, power and fire protection, and land. Coverage must be tested on a lease-up that may take longer than the sponsor expects and with a downside for the anchor tenant. An appraiser should say what a large box is worth when vacant, and a lender should ask how many months of vacancy the coverage ratio can absorb before it fails. FY2026 is a complete fiscal year, so it can be read beside the earlier ones. The yearly pattern shows lumps: 12 loans and $21.1 million in FY2021, 6 loans and $19.0 million in FY2024, but only 3 loans in FY2025 and 7 loans and $8.8 million in FY2026.