Buying a Dunn Brothers Coffee franchise: SBA acquisition loan data
Since FY2018, SBA lenders have approved 5 7(a) loans to buy an existing Dunn Brothers Coffee (classified mostly as Limited-Service Restaurants), totaling $1.6M. The median loan was $220,000, 66% lower than the $645,250 median for all SBA-financed acquisitions.
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What this tells a buyer
- Price range to expect. Loan size tracks purchase price. Half of Dunn Brothers Coffee resale loans landed between $135,000 and $535,000.
- Lender experience exists. Kensington Bank alone has financed 3 Dunn Brothers Coffee resales.
- Guaranty. The SBA guaranteed 71% of the dollars lent here.
- What the file leaves out. The SBA file does not record franchisor transfer terms or fees.
Financing a Dunn Brothers Coffee resale
The median SBA 7(a) loan for a Dunn Brothers Coffee resale was $220,000 across 5 loans (FY2018 to FY2026). Kensington Bank, Choice Financial Group and Granite Bank have financed the most Dunn Brothers Coffee resales. Too few of these loans are old enough to measure a charge-off rate; the average for all SBA acquisition loans is 3.5%.
Dunn Brothers Coffee acquisition loans by year
| Fiscal year | Loans | Total approved | Median loan | |
|---|---|---|---|---|
| FY2018 | 1 | $535K | $535,000 | |
| FY2019 | 2 | $665K | $332,500 | |
| FY2020 | 0 | $0 | - | |
| FY2021 | 0 | $0 | - | |
| FY2022 | 2 | $355K | $177,500 | |
| FY2023 | 0 | $0 | - | |
| FY2024 | 0 | $0 | - | |
| FY2025 | 0 | $0 | - | |
| FY2026 | 0 | $0 | - |
How often do these acquisition loans fail?
Fewer than 20 Dunn Brothers Coffee acquisition loans are old enough to measure losses reliably, so no charge-off rate is shown. The benchmark across all SBA acquisition loans in the FY2018 to FY2021 cohort is 3.5% by count. Non-acquisition 7(a) loans (every other stated purpose) approved FY2018 to FY2021 charged off at 6.2%.
"Charged off" is the SBA's final loss action on a defaulted loan after collection efforts. It lags default by a year or more, which is why only older cohorts are measured. It is not the same as a delinquency rate, and loans still outstanding can still fail. See charge-off in the glossary.
The purchase agreement decides what you bought, not the loan approval.
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Lenders financing Dunn Brothers Coffee resales
| # | Lender | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Kensington Bank | 3 | 60.0% | $1.2M | |
| 2 | Choice Financial Group | 1 | 20.0% | $220K | |
| 3 | Granite Bank | 1 | 20.0% | $135K |
States where Dunn Brothers Coffee units are bought
| # | State | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Minnesota | 5 | 100.0% | $1.6M |
The purchase agreement decides what you bought, not the loan approval.
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How lenders classify Dunn Brothers Coffee
Lenders code each loan to a NAICS industry. For Dunn Brothers Coffee the codes used were:
| # | Industry | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Limited-Service Restaurants | 2 | 40.0% | $675K | |
| 2 | Snack and Nonalcoholic Beverage Bars | 2 | 40.0% | $345K | |
| 3 | All Other Specialty Food Retailers | 1 | 20.0% | $535K |
Questions buyers ask
How much do buyers borrow to buy a Dunn Brothers Coffee franchise?
The median SBA 7(a) loan for a Dunn Brothers Coffee resale was $220,000 across 5 loans (FY2018 to FY2026). The middle half of loans ran from $135,000 to $535,000. The loan excludes the buyer's equity and any seller note and may include working capital, so the price is usually higher than the loan.
Which banks finance Dunn Brothers Coffee acquisitions?
Kensington Bank has made the most SBA acquisition loans for Dunn Brothers Coffee (3, 60% of the total). Choice Financial Group, Granite Bank follow.
What interest rate and term do Dunn Brothers Coffee acquisition loans carry?
The average initial rate at approval was 6.70% (a blend of fixed and variable loans across several rate environments, so treat it as context, not a quote). The median term was 7 years.
Is a Dunn Brothers Coffee resale riskier than other SBA-financed acquisitions?
Too few Dunn Brothers Coffee acquisition loans are old enough to measure. The benchmark for all SBA acquisition loans is 3.5% charged off in the FY2018 to FY2021 cohort.
Where are Dunn Brothers Coffee units being bought with SBA loans?
Minnesota (5). State counts follow where the brand has units and where SBA lending is most active generally; see the state pages for the overall picture.
Terms signed in the LOI shape the purchase agreement that follows.
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Related
- All Limited-Service Restaurants acquisitions
- Minnesota acquisitions
- Choice Financial Group
- All franchise brands
Brand name as recorded by lenders in the SBA file: "Dunn Brothers Coffee" (franchise code S2180). Figures are aggregates of public SBA data and are not provided or endorsed by the franchisor.