Buying an Extended Stay America Suites franchise: SBA acquisition loan data
Since FY2018, SBA lenders have approved 10 7(a) loans to buy an existing Extended Stay America Suites (classified mostly as Hotels (except Casino Hotels) and Motels), totaling $35.9M. The median loan was $3,698,000, 473% higher than the $645,250 median for all SBA-financed acquisitions. 3 of these loans were approved in the last two fiscal years.
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What this tells a buyer
- Price range to expect. Loan size tracks purchase price. Half of Extended Stay America Suites resale loans landed between $2,805,000 and $4,311,000.
- Lender experience exists. GBank alone has financed 4 Extended Stay America Suites resales.
- Guaranty. The SBA guaranteed 75% of the dollars lent here.
- What the file leaves out. The SBA file does not record franchisor transfer terms or fees.
Financing an Extended Stay America Suites resale
The median SBA 7(a) loan for an Extended Stay America Suites resale was $3,698,000 across 10 loans (FY2018 to FY2026). GBank, Bank of Hope and Shoreham Bank have financed the most Extended Stay America Suites 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%.
Extended Stay America Suites acquisition loans by year
| Fiscal year | Loans | Total approved | Median loan | |
|---|---|---|---|---|
| FY2018 | 0 | $0 | - | |
| FY2019 | 0 | $0 | - | |
| FY2020 | 0 | $0 | - | |
| FY2021 | 0 | $0 | - | |
| FY2022 | 1 | $4.8M | $4,760,000 | |
| FY2023 | 1 | $4.4M | $4,400,000 | |
| FY2024 | 5 | $16.2M | $3,626,000 | |
| FY2025 | 1 | $3M | $3,000,000 | |
| FY2026 | 2 | $7.5M | $3,770,000 |
How often do these acquisition loans fail?
Fewer than 20 Extended Stay America Suites 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.
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Lenders financing Extended Stay America Suites resales
| # | Lender | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | GBank | 4 | 40.0% | $15.1M | |
| 2 | Bank of Hope | 2 | 20.0% | $7.5M | |
| 3 | Shoreham Bank | 2 | 20.0% | $6.5M | |
| 4 | Byline Bank | 1 | 10.0% | $4.8M | |
| 5 | American Bank | 1 | 10.0% | $2.1M |
States where Extended Stay America Suites units are bought
| # | State | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Illinois | 2 | 20.0% | $8.8M | |
| 2 | Ohio | 2 | 20.0% | $6.5M | |
| 3 | Texas | 1 | 10.0% | $5M | |
| 4 | Georgia | 1 | 10.0% | $4.4M | |
| 5 | North Carolina | 1 | 10.0% | $3.6M | |
| 6 | Alabama | 1 | 10.0% | $3M | |
| 7 | Kansas | 1 | 10.0% | $2.5M | |
| 8 | Mississippi | 1 | 10.0% | $2.1M |
That draft favors the seller. We review it for the buyer, line by line.
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Questions buyers ask
How much do buyers borrow to buy an Extended Stay America Suites franchise?
The median SBA 7(a) loan for an Extended Stay America Suites resale was $3,698,000 across 10 loans (FY2018 to FY2026). The middle half of loans ran from $2,805,000 to $4,311,000. 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 Extended Stay America Suites acquisitions?
GBank has made the most SBA acquisition loans for Extended Stay America Suites (4, 40% of the total). Bank of Hope, Shoreham Bank, Byline Bank follow.
What interest rate and term do Extended Stay America Suites acquisition loans carry?
The average initial rate at approval was 8.62% (a blend of fixed and variable loans across several rate environments, so treat it as context, not a quote). The median term was 25 years.
Is an Extended Stay America Suites resale riskier than other SBA-financed acquisitions?
Too few Extended Stay America Suites 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 Extended Stay America Suites units being bought with SBA loans?
Illinois (2), Ohio (2), Texas (1), Georgia (1), North Carolina (1). 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 Hotels (except Casino Hotels) and Motels acquisitions
- Illinois acquisitions
- Ohio acquisitions
- Texas acquisitions
- GBank
- Bank of Hope
- Shoreham Bank
- All franchise brands
Brand name as recorded by lenders in the SBA file: "Extended Stay America Suites" (franchise code S5432). Figures are aggregates of public SBA data and are not provided or endorsed by the franchisor.