Buying a Quality Inn franchise: SBA acquisition loan data
Since FY2018, SBA lenders have approved 188 7(a) loans to buy an existing Quality Inn (classified mostly as Hotels (except Casino Hotels) and Motels), totaling $578M. The median loan was $2,993,500, 364% higher than the $645,250 median for all SBA-financed acquisitions. Volume fell 42% from FY2024 to FY2026. 30 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 Quality Inn resale loans landed between $2,289,500 and $3,800,000.
- Lender experience exists. GBank alone has financed 70 Quality Inn resales.
- Guaranty. The SBA guaranteed 76% of the dollars lent here.
- What the file leaves out. The SBA file does not record franchisor transfer terms or fees.
Financing a Quality Inn resale
The median SBA 7(a) loan for a Quality Inn resale was $2,993,500 across 188 loans (FY2018 to FY2026). GBank, First Western SBLC, LLC d/b/a Peachtree Group and United Midwest Savings Bank National Association have financed the most Quality Inn resales. Of 87 seasoned loans (FY2018 to FY2021), 2.3% were charged off, 35% lower than the 3.5% average for all SBA acquisition loans.
Quality Inn acquisition loans by year
| Fiscal year | Loans | Total approved | Median loan | |
|---|---|---|---|---|
| FY2018 | 27 | $82.7M | $3,200,000 | |
| FY2019 | 24 | $74.3M | $3,020,000 | |
| FY2020 | 17 | $50.8M | $2,990,000 | |
| FY2021 | 19 | $47.6M | $2,520,000 | |
| FY2022 | 33 | $103M | $3,255,000 | |
| FY2023 | 19 | $61.7M | $2,981,000 | |
| FY2024 | 19 | $59.3M | $2,935,000 | |
| FY2025 | 19 | $64.7M | $3,193,000 | |
| FY2026 | 11 | $33.5M | $2,985,000 |
How often do these acquisition loans fail?
Of the 87 Quality Inn acquisition loans approved from FY2018 to FY2021 (the seasoned cohort, every loan at least about five years old), 2 have been charged off by the SBA, a rate of 2.3% by loan count and 1.1% by dollars. 58 have already been paid in full.
For comparison, the charge-off rate across all SBA 7(a) acquisition loans in the same cohort is 3.5%, so Quality Inn is 35% lower than the acquisition-loan average. 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 Quality Inn resales
| # | Lender | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | GBank | 70 | 37.2% | $212M | |
| 2 | First Western SBLC, LLC d/b/a Peachtree Group | 13 | 6.9% | $32M | |
| 3 | United Midwest Savings Bank National Association | 7 | 3.7% | $21.5M | |
| 4 | PromiseOne Bank | 6 | 3.2% | $17M | |
| 5 | First Bank | 4 | 2.1% | $12.6M | |
| 6 | VelocitySBA, LLC | 4 | 2.1% | $11.8M | |
| 7 | The Huntington National Bank | 4 | 2.1% | $10.5M | |
| 8 | Shoreham Bank | 4 | 2.1% | $7.9M | |
| 9 | Bank of Hope | 3 | 1.6% | $12.2M | |
| 10 | Peapack Private Bank and Trust | 3 | 1.6% | $10.8M |
States where Quality Inn units are bought
| # | State | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | North Carolina | 20 | 10.6% | $68.5M | |
| 2 | South Carolina | 17 | 9.0% | $50.3M | |
| 3 | Indiana | 16 | 8.5% | $47.8M | |
| 4 | Virginia | 16 | 8.5% | $47M | |
| 5 | Georgia | 15 | 8.0% | $45.6M | |
| 6 | Ohio | 12 | 6.4% | $34.5M | |
| 7 | Florida | 10 | 5.3% | $39.3M | |
| 8 | Illinois | 10 | 5.3% | $24.9M | |
| 9 | Michigan | 8 | 4.3% | $29.9M | |
| 10 | California | 8 | 4.3% | $29M |
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Questions buyers ask
How much do buyers borrow to buy a Quality Inn franchise?
The median SBA 7(a) loan for a Quality Inn resale was $2,993,500 across 188 loans (FY2018 to FY2026). The middle half of loans ran from $2,289,500 to $3,800,000. 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 Quality Inn acquisitions?
GBank has made the most SBA acquisition loans for Quality Inn (70, 37% of the total). First Western SBLC, LLC d/b/a Peachtree Group, United Midwest Savings Bank National Association, PromiseOne Bank follow.
What interest rate and term do Quality Inn acquisition loans carry?
The average initial rate at approval was 7.02% (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 a Quality Inn resale riskier than other SBA-financed acquisitions?
In the seasoned cohort (FY2018 to FY2021), 2.3% charged off, 35% lower than the 3.5% average for all SBA acquisition loans.
Where are Quality Inn units being bought with SBA loans?
North Carolina (20), South Carolina (17), Indiana (16), Virginia (16), Georgia (15). State counts follow where the brand has units and where SBA lending is most active generally; see the state pages for the overall picture.
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Related
- All Hotels (except Casino Hotels) and Motels acquisitions
- North Carolina acquisitions
- South Carolina acquisitions
- Indiana acquisitions
- GBank
- First Western SBLC, LLC d/b/a Peachtree Group
- United Midwest Savings Bank National Association
- All franchise brands
Brand name as recorded by lenders in the SBA file: "Quality Inn, Quality Inn & Suites," (franchise code S1373). Figures are aggregates of public SBA data and are not provided or endorsed by the franchisor.