Buying a Studio 6 franchise: SBA acquisition loan data
Since FY2018, SBA lenders have approved 13 7(a) loans to buy an existing Studio 6 (classified mostly as Hotels (except Casino Hotels) and Motels), totaling $41.3M. The median loan was $2,500,000, 287% higher than the $645,250 median for all SBA-financed acquisitions. 8 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 Studio 6 resale loans landed between $2,187,000 and $4,450,000.
- Lender experience exists. GBank alone has financed 2 Studio 6 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 Studio 6 resale
The median SBA 7(a) loan for a Studio 6 resale was $2,500,000 across 13 loans (FY2018 to FY2026). GBank, Plains State Bank and Columbia Bank have financed the most Studio 6 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%.
Studio 6 acquisition loans by year
| Fiscal year | Loans | Total approved | Median loan | |
|---|---|---|---|---|
| FY2018 | 0 | $0 | - | |
| FY2019 | 2 | $4.3M | $2,134,500 | |
| FY2020 | 2 | $4.8M | $2,416,300 | |
| FY2021 | 1 | $1.7M | $1,725,000 | |
| FY2022 | 0 | $0 | - | |
| FY2023 | 0 | $0 | - | |
| FY2024 | 0 | $0 | - | |
| FY2025 | 3 | $12.5M | $5,000,000 | |
| FY2026 | 5 | $18M | $4,136,000 |
How often do these acquisition loans fail?
Fewer than 20 Studio 6 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 Studio 6 resales
| # | Lender | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | GBank | 2 | 15.4% | $9.1M | |
| 2 | Plains State Bank | 2 | 15.4% | $5.8M | |
| 3 | Columbia Bank | 2 | 15.4% | $4.3M | |
| 4 | Open Bank | 1 | 7.7% | $5M | |
| 5 | US Metro Bank | 1 | 7.7% | $5M | |
| 6 | HomeTrust Bank | 1 | 7.7% | $4.5M | |
| 7 | First Service Credit Union | 1 | 7.7% | $2.5M | |
| 8 | Peoples Bank | 1 | 7.7% | $2.4M | |
| 9 | The Huntington National Bank | 1 | 7.7% | $1.7M | |
| 10 | American Bank | 1 | 7.7% | $993K |
States where Studio 6 units are bought
| # | State | Loans | Share | Dollars | |
|---|---|---|---|---|---|
| 1 | Texas | 4 | 30.8% | $13.3M | |
| 2 | Mississippi | 4 | 30.8% | $10.1M | |
| 3 | Louisiana | 2 | 15.4% | $3.4M | |
| 4 | California | 1 | 7.7% | $5M | |
| 5 | New Mexico | 1 | 7.7% | $5M | |
| 6 | Georgia | 1 | 7.7% | $4.5M |
The purchase agreement decides what you bought, not the loan approval.
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Questions buyers ask
How much do buyers borrow to buy a Studio 6 franchise?
The median SBA 7(a) loan for a Studio 6 resale was $2,500,000 across 13 loans (FY2018 to FY2026). The middle half of loans ran from $2,187,000 to $4,450,000. 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 Studio 6 acquisitions?
GBank has made the most SBA acquisition loans for Studio 6 (2, 15% of the total). Plains State Bank, Columbia Bank, Open Bank follow.
What interest rate and term do Studio 6 acquisition loans carry?
The average initial rate at approval was 7.50% (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 Studio 6 resale riskier than other SBA-financed acquisitions?
Too few Studio 6 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 Studio 6 units being bought with SBA loans?
Texas (4), Mississippi (4), Louisiana (2), California (1), New Mexico (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.
The purchase agreement decides what you bought, not the loan approval.
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Related
- All Hotels (except Casino Hotels) and Motels acquisitions
- Texas acquisitions
- Mississippi acquisitions
- Louisiana acquisitions
- GBank
- Plains State Bank
- Columbia Bank
- All franchise brands
Brand name as recorded by lenders in the SBA file: "Studio 6" (franchise code S1633). Figures are aggregates of public SBA data and are not provided or endorsed by the franchisor.