August 2023, the team at Wert-Berater, Inc. completed a hotel feasibility study for Planned New Construction Staybridge Suites Hotel 100-key, 81,822 SF franchised interior corridor extended stay hotel at 4075-4085 Cerrillos Road, Santa Fe, New Mexico postal code 87507.
The purpose of this hotel feasibility study for financing through the SBA (Small Business Administration) therefore this hotel feasibility study complied with SBA CFR-2011-Title13 §120.160SBA CFR-2011-Title13 §120.160.
The Total Cost was $15,646,206 including an estimated $563,750 interest reserve. The F, F, & E allocation was $2,113,000. Financing detail was not provided for the development of this report. To estimate Debt Service Coverage Ratio potential and estimate of prevailing rates and loan to costs was applied as follows. The proposed financing is $11,000,000 (70.3% LTC).
To comply with the SBA feasibility study requirements, this report included the following details:
Executive Summary: An overview of the business concept, objectives, and key findings of the feasibility study.
Economic Feasibility: Analysis of the economic environment, including industry trends, economic indicators, and the potential impact on the business.
Market Feasibility: Detailed market analysis covering target demographics, market demand, competition, and potential market share. This section demonstrates the business's ability to capture and sustain a customer base.
Technical Feasibility: Evaluation of the technical requirements of the project, including necessary equipment, technology, and operational processes. It assesses whether the business has or can acquire the technical resources needed.
Management Feasibility: Assessment of the management team's qualifications, experience, and ability to execute the business plan effectively. This includes evaluating the adequacy and continuity of management.
Financial Feasibility: Comprehensive financial analysis, including:
Pro Forma Financial Statements: Projected income statements, balance sheets, and cash flow statements over a specified period (often 10 years).
Discounted Cash Flow Analysis (DCF): Evaluation of the present value of future cash flows to assess the project's profitability.
Financial Ratios and Sustainability Analysis: Examination of key financial ratios to determine the financial health and sustainability of the business.
Working Capital and Liquidity Analysis: Assessment of the business's ability to meet short-term obligations and maintain sufficient cash flow.
Financial Feasibility Table of Contents:
Pro forma (10 years)
Discounted Cash Flow Analysis (DCF)
Structure of the Assets and Liabilities
Net Assets (Net Worth)
Financial Sustainability Analysis
Key ratios of the company's financial sustainability
Working capital analysis
Liquidity Analysis Financial Performance
Overview of the Financial Results
Profitability Ratios
Analysis of the Business Activity (Turnover Ratios)
Labor productivity
Key Ratios Summary
Rating of the Financial Position and Financial Performance
Bankruptcy Test
Calculation of the Final Rating of the Financial Condition
These components collectively provide a thorough evaluation of the proposed business venture, helping lenders determine its feasibility and the likelihood of success. A well-prepared feasibility study is crucial for securing SBA financing, as it demonstrates careful planning and a clear understanding of the business environment.
Publisher Details: RV & Boat Storage Feasibility Studies: SBA Feasibility Study Consultants: USDA Feasibility Study Consultants: Wert-Berater, Inc. at https://www.wert-berater.com
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Why Choose Wert-Berater, Inc.?
The SBA Compliant Feasibility Study is a document that loan underwriters depend on for that final decision to approve or reject your loan application.
With over 3,500 feasibility studies completed since 1998, you can trust that your investment into a feasibility study with Wert-Berater, Inc. will comply with all SBA requirements.
The feasibility study done well is crucial in today's high demand for SBA loans.
Travis Miller
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