The Mandate
A practicing veterinarian developing a ground-up small-animal hospital engaged Feasibility Study Consultant to prepare a third-party feasibility study supporting a SBA 7(a) financing request for a project located in Bernalillo County, New Mexico. Total project capitalization fell within the $1M-$3M band. The capital provider, a specialty SBA lender, required documentation consistent with current program review standards. The analytical question put to the team: Did Albuquerque trade-area pet ownership and capacity-constrained competitor utilization support a four-DVM hospital.
Engagement Scope
- Primary market area defined as a 5-mile drive-time
- Comparable supply set of 10 properties
- Demand model framework: pet-ownership household capture and DVM-capacity analysis
- Financial projection horizon: 7 years
- Site inspection completed; operator interviews where applicable
- Primary data collection through field reconnaissance and third-party market data
Methodology Applied
Primary Market Area
The PMA was defined as a 5-mile drive-time from the subject site, calibrated to the demand catchment behavior typical of healthcare assets in New Mexico. The boundary captured the population, employment, and competitive supply base relevant to the subject's operating thesis.
Supply and Demand Reconciliation
The comparable supply set comprised 10 properties operating within the PMA or in directly substitutable submarkets. Demand was modeled using a pet-ownership household capture and DVM-capacity analysis approach over a 7 years horizon. The reconciliation tested whether incremental supply, including the subject, could be absorbed within the projection window without compromising stabilized occupancy assumptions.
Capture Rate Calibration
The subject's capture rate was calibrated against the absorption capacity of the PMA. The analysis concluded that PMA absorption capacity exceeded subject build-out by a factor of 1.9 across the projection window, with a stabilized capture rate of 4.4%.
Exhibit 1: Comparable Supply Set, New Mexico PMA
[Table or chart rendered in delivered report.]
Exhibit 2: Demand Projection Summary, 7 years Horizon
[Table or chart rendered in delivered report.]
Exhibit 3: Subject Capture Rate vs. PMA Absorption Capacity
[Table or chart rendered in delivered report.]
Analytical Conclusions
- PMA contained 38,400 pet-owning households against an active capacity of 18 DVM operatories.
- Comparable veterinary hospitals operated at 86% to 92% appointment-block utilization.
- Subject's projected ramp to 22 daily appointments per DVM was supported by the comp-set median.
- Stabilized DSCR of 1.44x cleared the SBA 7(a) review threshold.
Deliverable
The delivered report ran 102 pages with 23 exhibits distributed across nine analytical sections, plus appendices documenting comparable supply data, demographic inputs, and financial projection assumptions. The document was prepared to the documentation standards of the specialty SBA lender. The corresponding SBA 7(a) review framework guided exhibit selection and supporting documentation.