US Gas Station Market Report and Outlook, 2026 to 2035

Fuel volumes, margins, consolidation, real estate pricing, credit performance, and the long-run outlook for gas stations and fuel-selling convenience stores in the United States.

Published September 2026 by Feasibility Study Consultant (FSC Consulting, Inc.), the practice run by Sarrah Allen, MAI, which prepares lender-facing gas station feasibility studies nationwide. Data is current through the third quarter of 2026 where published figures exist. Every figure carries its source and as-of date, and where two credible sources disagree, both are shown.

Executive summary

The American gas station is being pulled in two directions at once. The core commodity is in slow structural decline: US motor gasoline consumption peaked in 2018 and has not returned to that level, and the US Energy Information Administration (EIA) expects the drift lower to continue as the vehicle fleet becomes more efficient. Yet the businesses selling that fuel have rarely earned more per gallon. Retail fuel margins averaged more than 40 cents per gallon across the convenience industry in 2025, roughly double the pre-2020 norm, and in-store sales grew for the 23rd consecutive year. The headline narrative for the sector (peak gasoline, electric vehicles, stranded assets) is considerably worse than its current cash flow.

For lenders, investors, and borrowers, the practical conclusion is that the gas station market is no longer one market. It is splitting into two populations of sites. The first is the large-format, high-traffic, foodservice-led store on generous acreage, frequently built new by a regional chain, pricing tightly in net lease markets and generating debt service coverage well above lender thresholds. The second is the legacy station: a small building, a thin inside offering, tanks installed in the 1990s, fuel as the dominant revenue line, and a trade area that a new-format competitor has entered or soon will. The national store count is falling slowly because the second population is shrinking faster than the first is growing.

Five findings frame the outlook through 2035.

First, the store universe is consolidating while fuel remains central. The US had 151,975 convenience stores at the end of 2025, the second consecutive annual decline, yet the number selling fuel rose to an eight-year high. Closures are concentrated among small and non-fuel stores; growth is concentrated among large fuel-selling formats.

Second, margins have re-rated and now carry more of the load. Fuel margins above 40 cents per gallon offset a slowdown in customer transactions and persistent cost inflation in labor, card fees, and insurance. Underwriting that assumes 2025 margins persist indefinitely is the single most common error the sector invites.

Third, foodservice is the dividing line. Foodservice generated 28.5 percent of in-store sales and 38.9 percent of in-store gross profit in 2025. Sites that cannot support prepared food are structurally disadvantaged against those that can.

Fourth, gasoline decline is gradual, not abrupt. The repeal of federal electric vehicle tax credits effective September 30, 2025 slowed electrification, and fleet turnover is slow in any scenario. The risk to fuel volumes is real but measured in decades and concentrated in specific sites, not the asset class as a whole.

Fifth, capital markets still reward fuel real estate and credit risk is idiosyncratic. Net lease cap rates for investment-grade convenience tenants sit around 5 percent, fuel-selling assets price materially tighter than non-fuel convenience stores, and SBA loan history shows gas stations default relatively often but lose relatively little per dollar, because land, building, and tanks recover most of the balance. Environmental liability and tank age remain the dominant idiosyncratic risk.

Key figures

1. Defining the market

Statistical definitions matter more in this sector than in most, because the industry codes changed recently and lenders, appraisers, and data vendors do not all use the same version.

Under the 2017 North American Industry Classification System (NAICS), gas stations sat in subsector 447, with code 447110 for gasoline stations with convenience stores and 447190 for other gasoline stations. The 2022 revision renumbered the group as subsector 457, Gasoline Stations and Fuel Dealers. The same businesses now appear as 457110 and 457120, while fuel dealers such as heating oil and propane distributors moved into their own industry group, 4572. A convenience store that does not sell fuel is classified separately as a convenience retailer under 445131.

This has three practical consequences. Loan performance histories spanning the change must map old codes to new ones, or the post-2022 gas station cohort appears to shrink when it has simply been recoded. Classification by primary activity means a store with a large inside operation and a modest forecourt can land in a food retail code in federal statistics while the trade association counts it as a fuel-selling convenience store. And the industry's standard store census, the NACS and NIQ TDLinx count, is a physical count of operating stores, whereas the Census Bureau counts establishments by primary activity and receipts. The two sources do not reconcile and should not be forced to.

This report uses the NACS count for store numbers, the NACS State of the Industry data and public company filings for store economics, EIA and Federal Highway Administration data for fuel demand, EPA data for environmental exposure, broker research for real estate pricing, and SBA FOIA loan-level data for credit history. Truck stops and travel centers, and hypermarket and club fuel, are discussed where they compete for the same gallons.

2. Market size and structure

Store count

The US convenience store count stood at 151,975 at the end of 2025, down 280 stores or 0.2 percent from a year earlier and the second consecutive annual decline, as reported by CSP. There is roughly one convenience store for every 2,257 US residents.

Source: NACS / NIQ TDLinx annual counts. The count is refreshed with methodology updates over time, so multi-year comparisons should be read as directional rather than exact.

The more telling figure sits underneath the total. Stores selling fuel rose by 768 to 122,620, or 80.7 percent of all convenience stores, the highest count in eight years. In a year when the overall count fell, fuel-selling stores grew. Closures were concentrated in smaller, often urban, non-fuel stores (New York lost 143 stores, the most of any state), while net additions came from fuel-selling formats in growth markets (Texas added 88, the most of any state). The industry is not retreating from fuel; it is retreating from small stores.

Ownership

The sector remains fragmented at the store level and concentrated at the top. Operators with 10 or fewer stores own 95,672 stores, or 63 percent of the total, and roughly 60 percent of all convenience stores are single-store operations. At the other end, companies operating 500 or more stores own 33,810 stores, or 22.2 percent. The mid-sized chain, large enough to carry overhead but too small to match the pricing technology, fuel supply terms, and foodservice programs of the regional leaders, is the thinnest and most pressured segment. It is also the most common acquisition target.

This structure shapes lending. A large share of gas station transactions below $10 million are single-store or small-portfolio changes of ownership between individual operators, and many are financed with SBA or community bank debt. The seller is often a long-tenured owner exiting; the buyer is often an experienced operator adding a store or a first-time owner entering the business.

Geography

Source: NACS / NIQ TDLinx.

Texas alone holds more than one in ten US convenience stores. Regional dynamics are covered in Section 10.

3. How a gas station makes money

The revenue split

The convenience industry generated $817.5 billion in 2025, according to the NACS State of the Industry report released in April 2026. Motor fuel accounted for $476.3 billion, down 5.4 percent as the average retail price fell from about $3.30 to about $3.11 per gallon, even though gallons sold rose about 0.5 percent. In-store sales of merchandise and foodservice reached $341.2 billion, up 1.7 percent.

Fuel is therefore about 58 percent of sales dollars but, by NACS's measure, under 40 percent of gross profit dollars. The inside of the store earns the majority of gross profit on the minority of revenue. That ratio is the most important structural fact for underwriting: a station valued on gallons alone is being valued on its lower-margin business.

Fuel margins

Retail fuel margins averaged more than 40 cents per gallon across the industry in 2025, according to NACS Research. For most of the decade before 2020, margins ran in the low 20s. Part of the increase is inflation; much of it is real.

Three forces explain the re-rating. Operating costs per store have risen sharply since 2021, so the margin required to break even has risen with them. Gallons per store have been flat to declining, so operators must earn more on each gallon to cover fixed costs. And the largest chains now price with sophisticated competitive data and have shown more discipline about not surrendering margin to buy volume. Smaller operators, facing the same cost inflation, generally price up behind them rather than against them.

Headline margin overstates profit. Card processing fees consume a meaningful slice of every gallon sold on a card, rising with the pump price, and store labor, utilities, maintenance, insurance, and environmental compliance absorb much of the rest. On NACS's own arithmetic, pre-tax profit per gallon is a small fraction of the gross margin.

Margins are also volatile in a predictable pattern. When wholesale prices fall quickly, retail prices follow slowly and margins widen. When wholesale prices spike, retail prices lag and margins compress, sometimes to near zero for weeks. Annual averages hide this. Publicly traded Murphy USA illustrates both the level and the swing: its full-year 2025 results showed a retail fuel margin of about 28 cents per gallon and total fuel contribution near 31 cents on roughly 4.8 billion gallons, while its second quarter 2026 total fuel contribution reached about 41 cents amid renewed commodity volatility. Murphy is a low-price, high-volume operator and earns below the industry average per gallon by design; the example matters because it shows how much quarterly margin can move for a well-run business.

Inside the store

Foodservice is the category that separates winners from the rest of the field. It represented 28.5 percent of in-store sales and 38.9 percent of in-store gross profit in 2025, up from 11.9 percent of sales in 2005. Prepared food makes up about three quarters of the foodservice total. Packaged beverages were the second-largest category at 18.7 percent of in-store sales. Alternative snacks grew 7.9 percent, a trend NACS partly attributes to changing consumption among GLP-1 medication users.

Tobacco and nicotine remain a large sales category but a weakening traffic driver. Cigarette volumes continue their long decline, partly offset by growth in nicotine pouches, which gained momentum after the FDA authorized marketing of ZYN products in January 2025. The FDA withdrew its proposed menthol cigarette ban the same month, removing a significant near-term risk to cigarette-dependent stores, though state and local flavor restrictions continue to expand. Lottery, beer, and wine add traffic and margin where state law allows.

Traffic is the soft spot. The average store recorded about 1,484 transactions per day in 2025, down 2.7 percent, while basket values rose. Fewer trips with larger baskets favors stores with a destination food offer and loyalty programs, and disadvantages stores whose inside business depends on impulse purchases by fuel customers.

The cost stack

Labor is the largest controllable expense, and wage floors have risen across most states. Card fees are the second structural pressure. US merchants paid a record $187.2 billion in card processing fees in 2024 according to the Nilson Report, with a further increase in 2025, and fuel retailers carry an unusually heavy share because they pay percentage-based fees on high-ticket fuel purchases, including on the fuel taxes they collect on behalf of government. The Credit Card Competition Act, which would require large card-issuing banks to enable routing over at least one competing network, was reintroduced in the Senate in 2026 but had not passed as of this report, and the long-running Visa and Mastercard interchange litigation settlement remained contested by retail trade groups. Insurance premiums, shrink from theft, and environmental compliance round out the stack.

New-build economics

The cost of a new-format suburban store with a full foodservice program now runs well into seven figures before land, and industry estimates for a representative build place the all-in figure around $6 million, requiring several million gallons per year plus a strong inside business to justify the investment. Destination travel centers cost many multiples of that. These economics explain two trends at once: why new-to-industry builds are concentrated among well-capitalized regional chains, and why a new-format entrant can take a disproportionate share of a trade area's gallons from incumbent legacy stations.

4. Fuel demand fundamentals

Consumption has peaked

US finished motor gasoline consumption reached a record of about 9.33 million barrels per day, or roughly 392 million gallons per day, in 2018. In 2025 it averaged about 8.9 million barrels per day, or about 375 million gallons per day, about 1 percent below 2024 and about 4 percent below pre-pandemic 2019, according to the EIA. EIA's Short-Term Energy Outlook expects consumption to keep declining gradually through 2027.

Driving is up, fuel use is down

The central fact for fuel volume underwriting is the decoupling of driving from gasoline. Vehicle miles traveled set new records in 2025, reaching roughly 3.3 trillion miles on the Federal Highway Administration's Traffic Volume Trends series. Gasoline consumption nonetheless fell, because fleet fuel economy improvements, including a rising share of hybrids, outpace growth in miles driven. More cars passing a site no longer means proportionally more gallons sold at it.

Prices

EIA's 2026 outlook editions forecast US regular gasoline averaging about $3.70 per gallon in 2026 and $3.46 in 2027, up from about $3.10 in 2025, and on-highway diesel averaging about $4.80 in 2026 and $4.11 in 2027, up from about $3.66 in 2025. The upward revision reflects geopolitical supply disruption in crude markets during 2026 and declining domestic refining capacity, most acutely on the West Coast following refinery closures in California. Higher pump prices depress demand only modestly, since gasoline is price inelastic in the short run, but they raise card fees per gallon, can compress margins during spikes, and erode discretionary inside spending.

Fuel economy policy

Federal fuel economy policy moved toward relaxation in 2025. The 2025 budget reconciliation law eliminated the civil penalty for noncompliance with Corporate Average Fuel Economy standards, and federal regulators proposed resetting the standards themselves. EIA expects little near-term effect on consumption, because automakers plan on five-to-seven-year design cycles and consumer demand for efficient vehicles and hybrids persists. Over a 10-year horizon, weaker standards would slow the rate of gasoline decline modestly.

Ethanol blends

In April 2025, EPA approved year-round sales of E15 in eight Midwest states: Illinois, Iowa, Minnesota, Missouri, Nebraska, Ohio, South Dakota, and Wisconsin. For stations in those states, E15 offers a price-competitive product and an additional margin line where tank and dispenser compatibility allows. Rural operators have used the USDA Higher Blends Infrastructure Incentive Program to fund compatible dispensers and tank upgrades, which is one of the few federal programs aimed directly at fuel retail infrastructure.

Diesel

Diesel demand follows freight activity more than consumer driving and is far less exposed to passenger electrification. Travel centers and truck stops therefore carry a different demand profile from convenience stations, more cyclical but with a slower structural decline. For convenience stores with a diesel lane serving local contractors and agricultural users, diesel is a stabilizing line.

5. Electric vehicles and alternative fuels

Adoption stalled after the credit repeal

About 22 percent of light-duty vehicles sold in the US in 2025 were hybrids, plug-in hybrids, or battery electric vehicles, up from about 20 percent in 2024, with conventional hybrids growing fastest. Electric vehicle sales surged to a record share of the market in September 2025, as buyers pulled purchases forward ahead of the expiration of federal credits, and then fell to less than half that share in each remaining month of the year, according to the EIA. The budget reconciliation law signed July 4, 2025 terminated the $7,500 new and $4,000 used clean vehicle credits for vehicles acquired after September 30, 2025.

Even before the repeal, electric vehicles represented a low single-digit share of the registered fleet. The average light vehicle on US roads is now close to 13 years old. That fleet age is the most underappreciated number in the stranded asset debate: even an aggressive rise in electric vehicle sales share would take well over a decade to translate into a comparable share of vehicles on the road, and therefore of gallons not sold.

Charging infrastructure

The federal National Electric Vehicle Infrastructure (NEVI) formula program, a $5 billion initiative created in 2021, was suspended in February 2025, challenged in court by a coalition of states, and restarted after the Federal Highway Administration issued revised guidance on August 11, 2025. States resubmitted deployment plans and awards resumed, but only a small number of NEVI-funded stations were operating nationally before the suspension, and some unobligated funds were subsequently rescinded. Private buildout continued independently of federal policy, led by Tesla's Supercharger network, the Ionna automaker joint venture, and partnerships at travel centers and convenience chains including Pilot, Love's, Buc-ee's, and Circle K. Current public station counts are available from the Department of Energy's Alternative Fuels Data Center.

For convenience retailers, fast charging is less a fuel replacement than a traffic and dwell-time play. A 20-to-40-minute charging session aligns well with foodservice and poorly with a kiosk-and-pumps legacy station. Utility demand charges, interconnection costs, and low utilization in many markets keep charging economics marginal on a standalone basis. The operators best positioned to monetize charging are the same ones already winning on food.

What stranded asset risk actually looks like

Mainstream forecasts point to gradual gasoline decline rather than collapse. EIA's Annual Energy Outlook reference case shows motor gasoline consumption declining over the coming decades, with wide dispersion across its alternative policy and technology cases. Under almost any credible path, the stations most exposed are identifiable today: low-volume sites with small buildings, limited acreage for redevelopment into a larger format, older tanks, and no meaningful inside business. For those sites, the risk is not that fuel demand disappears but that a shrinking pool of gallons concentrates in fewer, larger, better-located stores.

Alternative-use value is a genuine mitigant. Former station sites on busy corners convert to quick-service restaurants, express car washes, automotive service, urgent care, and small-format retail, subject to tank removal, closure sampling, and any remediation. The value of a station site to a non-fuel user is a legitimate floor in credit and investment analysis and should be assessed explicitly rather than assumed.

Hydrogen, renewable natural gas, and compressed natural gas remain niche outside specific heavy-duty corridors and fleet applications, and do not materially change the outlook for convenience stations over the report horizon.

6. Competitive landscape and consolidation

The leaders

7-Eleven remains the largest US convenience chain by store count, with more than 12,000 US stores and about 8 percent of the national total. Alimentation Couche-Tard, operating as Circle K, is second. Casey's General Stores, Murphy USA, ARKO's GPM Investments, EG America, and a group of large regional chains (Wawa, Sheetz, QuikTrip, RaceTrac, Kwik Trip, Maverik, Buc-ee's) round out the leadership, alongside the travel center networks of Pilot, Love's, and TravelCenters of America, which is owned by BP.

The strategic distinction is less about size than about format. The regional chains that dominate new-to-industry construction build larger stores, typically 5,000 square feet and up, on sites of two acres or more, with 12 to 20 or more fueling positions and a made-to-order food program. Buc-ee's operates at the extreme, with destination travel centers exceeding 70,000 square feet and more than 100 fueling positions, and continues to expand beyond Texas into the Southeast, Midwest, and Mountain West.

Hypermarket and warehouse club fuel (Costco, Sam's Club, Kroger, and Murphy USA's stores adjacent to Walmart) competes aggressively on price, using fuel as a traffic driver for the primary retail business. A legacy station within a short drive of a club fuel center faces a structural price ceiling.

The major integrated oil companies have largely exited direct ownership of retail stations, supplying branded dealers and distributors (jobbers) under long-term fuel supply agreements. Wholesale fuel distribution is itself consolidating around large partnerships and distributors including Sunoco, Global Partners, and CrossAmerica Partners.

Recent transactions

Alimentation Couche-Tard withdrew its roughly $47 billion proposal to acquire Seven & i Holdings, the parent of 7-Eleven, in July 2025, citing a lack of constructive engagement. Seven & i responded to the approach with a large share buyback and plans for a separate US listing of its North American convenience business. Couche-Tard subsequently focused on integrating the roughly 270 GetGo stores acquired from Giant Eagle.

Casey's completed its $1.145 billion acquisition of Fikes Wholesale, operator of 198 CEFCO stores, in November 2024, taking its store base to roughly 2,900. Sunoco LP completed its acquisition of Canadian fuel retailer and distributor Parkland Corporation in late 2025, creating the largest independent fuel distributor in the Americas. FEMSA, owner of Mexico's OXXO chain, entered the US convenience market by acquiring Delek's Texas-based retail stores in 2024, and RaceTrac agreed to acquire sandwich chain Potbelly in 2025, a transaction that underlines how central foodservice has become to chain strategy.

Valuation multiples

Convenience store M&A multiples have normalized from the post-pandemic peak. Investment bank Capstone Partners reports average enterprise value to EBITDA multiples of about 10.1 times for transactions from 2022 through 2025, down from about 11.9 times in 2018 to 2021, partly reflecting smaller average deal sizes. Differentiated, foodservice-forward chains with growth pipelines continue to command premiums. Single-store transactions trade on very different metrics, usually a combination of real estate value, fuel volume, and a multiple of seller's discretionary earnings.

The succession wave

A structural supply of stores for sale comes from aging owners of single stores and small portfolios. Many of these operators have run their stores for decades, face capital requirements for tank replacement, dispenser upgrades, and point-of-sale compliance, and have no family successor. This steady flow of change-of-ownership transactions is the foundation of the small-business gas station lending market discussed in Section 8.

7. Real estate and capital markets

Net lease pricing

Single-tenant net lease convenience stores with fuel remain one of the most liquid retail property types, favored by private investors, 1031 exchange buyers, and REITs for their long lease terms and tenant credit.

Source: The Boulder Group tenant profiles.

For context, the broader single-tenant net lease market averaged cap rates in the high 6 percent range in mid-2026. Within the convenience category, fuel is a pricing advantage: year-end 2025 data from net lease brokerage research put average cap rates for convenience stores with fuel around 5.6 percent, against roughly 6.9 percent for non-fuel convenience stores. Geography matters as well, with Florida and Texas trading well inside Midwest markets such as Illinois and Wisconsin.

Interest rates

The Federal Reserve cut its policy rate three times in late 2025 and held the federal funds target range at 3.50 to 3.75 percent through the first quarter of 2026. Long-term rates proved stickier, with the 10-year Treasury yield trading in the mid-4 percent range for much of 2026. Net lease cap rates for credit convenience tenants have stayed relatively stable through this cycle, supported by strong tenant coverage and investor demand, but the spread between cap rates and Treasury yields is thinner than its long-run average, which leaves pricing sensitive to any renewed rise in long-term rates.

Depreciation as a demand driver

Tax treatment is an underappreciated support for gas station real estate values. Under federal tax rules, a qualifying retail motor fuel outlet (broadly, one where at least half of revenue comes from fuel sales or at least half of floor space is devoted to fuel, or whose building is 1,400 square feet or less) can be treated as 15-year property rather than 39-year nonresidential real property, making the entire property, including the building, eligible for bonus depreciation. The 2025 reconciliation law restored 100 percent bonus depreciation for qualifying property acquired after January 19, 2025. The combination gives high-income investors a large first-year deduction on gas station acquisitions and drove a noticeable increase in investor demand and listing activity into late 2025 and 2026. Buyers and lenders should recognize that some of the pricing in this segment reflects tax benefit rather than operating fundamentals.

Sale-leaseback and REIT exposure

Chains fund growth by selling store real estate to investors on long-term leases, and this sale-leaseback supply is the main source of new net lease inventory. Getty Realty, the most concentrated public REIT in the sector, reported portfolio occupancy of 99.8 percent, a weighted average lease term of about 10 years, and trailing tenant rent coverage of 2.6 times as of the third quarter of 2025, according to its investor materials. Getty has diversified meaningfully into express car washes, auto service, and quick-service restaurants, while its convenience and gas portfolio continues to show improving rent coverage on the back of strong fuel margins. Agree Realty, NNN REIT, Realty Income, and Essential Properties Realty Trust also carry convenience store exposure within broader net lease portfolios.

Owner-occupied and going-concern value

Most gas stations outside the net lease market are owner-operated, and their value cannot be separated cleanly from the business. Appraisals for financing typically allocate a going-concern value among land, improvements, furniture, fixtures, and equipment (including tanks and dispensers), and intangible business value. The allocation is not a technicality. A transaction whose price is supported mostly by real estate behaves very differently in a default than one supported mostly by business value, as the credit data in the next section shows.

8. Credit performance and lending

The SBA market

Gas stations are one of the largest industries in SBA lending history. SBA loan-level FOIA data, as tabulated in house from the full SBA loan file we maintain behind our SBA feasibility study work, shows $17.7 billion lent to gas stations with convenience stores across 21,149 SBA 7(a) loans since 1995, making the industry the fourth-largest 7(a) category over that period, with a further $6.5 billion across 4,166 loans since fiscal 2020. Average loan sizes have risen with store values. The underlying data is publicly available from the SBA.

Frequency versus severity

Gas station credit performance is frequently misreported because two different measures get conflated. Measured as the share of resolved loans that defaulted, gas stations have historically shown elevated default frequency, with published estimates in the range of roughly 10 to 15 percent. Measured as dollars charged off relative to dollars approved, lifetime losses have been far lower, in the range of roughly 2 to 3.5 percent, better than several other small-business categories such as restaurants.

Both measures are correct. Gas stations fail more often than the average small business, but when they fail, the land, building, and tank system typically recover most of the outstanding balance. The practical lesson is that loan structure drives outcomes. Long-term, real estate secured financing, often through the SBA 504 program or 7(a) loans with 25-year real estate terms, performs dramatically better on a loss basis than shorter-term loans supported mainly by business goodwill. Seven in ten gas station 7(a) loans carry terms of 23 years or longer, reflecting the real estate intensity of the collateral. Young loan cohorts from fiscal 2020 onward show very low charge-off rates to date, but those vintages have not yet been tested by a full cycle and should not be read as lifetime performance.

Underwriting context

Lender requirements for gas station transactions have a few features worth highlighting without turning this report into a lending manual. SBA's SOP 50 10 8, effective June 1, 2025, reinstated minimum equity injection requirements, including a 10 percent injection for complete changes of ownership, with seller financing counting toward the injection only on full standby. Gas stations are treated as special-purpose properties, which in the 504 program adds to the required borrower contribution. And SBA's environmental policy treats gas stations as environmentally sensitive, so an environmental investigation at least at the Phase I level is required regardless of loan size, with tank compliance history and often tank tightness testing reviewed alongside it.

Beyond program requirements, three underwriting disciplines matter most for this asset class. Fuel margin assumptions should be stressed well below 2025 levels; a projection that only clears coverage at 40 cents per gallon is not a bankable projection, and margin is the assumption most often sent back on review, as set out in Why Gas Station Feasibility Studies Get Sent Back. Fuel volume should be tested against the competitive set within the trade area, including announced new-format builds and any club or hypermarket fuel within practical driving distance; our capture rate and EV transition case study and our fuel volume, inside sales and margin case study show how that test is built. And the split of value between real estate and business should be documented, because it determines the recovery profile if the projection is wrong.

USDA in rural markets

In rural areas, the USDA Business and Industry Loan Guarantee program under 7 CFR Part 5001 is an alternative guarantee channel for fuel and convenience projects in communities outside cities above 50,000 population. Rural stations often face less direct competition but lower traffic and volumes, and a single store may be a community's only source of fuel and groceries within a wide radius, which makes market capture and resilience analysis central. The program choice itself changes the scope of the study, as explained in USDA Business and Industry feasibility studies. The USDA's Rural Energy for America Program has also supported energy efficiency and renewable energy improvements at rural small businesses, including convenience stores, subject to the program's current eligibility rules.

Conventional and CMBS debt

Community and regional banks finance a large share of owner-occupied station acquisitions outside the SBA program, generally with lower leverage and shorter amortization. Stabilized net leased stores with credit tenants are routinely financed by life companies and banks at conservative leverage. Gas stations and convenience stores also appear as collateral in CMBS conduit pools, typically as smaller loans or within retail portfolios. Current delinquency data specific to this collateral type is not consistently published by the rating agencies or data providers, and is identified as a gap in the methodology notes below.

What causes defaults

Across lending channels, gas station defaults trace to a recurring set of causes: an acquisition priced on peak fuel margins; a new-format competitor opening within the trade area and taking gallons and inside traffic; loss of a fuel brand or an unfavorable fuel supply agreement; deferred capital needs such as tank replacement or dispenser upgrades arriving before the business can fund them; environmental contamination discovered after closing, the gating issue in our underground storage tank case study; and inexperienced operators unable to manage labor, shrink, and pricing in a thin-margin business.

9. Environmental and regulatory risk

The tank universe

Underground storage tanks are the defining environmental exposure of the asset class. As of March 2026, the EPA reported 583,313 confirmed releases from regulated tanks since the federal program began, with more than 530,000 cleaned up, leaving a backlog of roughly 53,000 sites still in remediation. The backlog has been reduced from more than 129,000 in 2004. Roughly half a million federally regulated active tanks remain in service nationwide.

EPA's 2015 revisions to the federal tank regulations added requirements for secondary containment on new and replaced tanks and piping, operator training, periodic walkthrough inspections, and testing of spill and overfill prevention equipment, with most compliance deadlines phased in by October 2018. State programs often exceed federal requirements.

The tank age wall

A large share of the current tank population was installed or upgraded during the late 1980s and 1990s, ahead of the federal December 1998 upgrade deadline. Many of those systems are now approaching or exceeding 30 years in service, a common benchmark for manufacturer warranties and insurer comfort. Replacement of a full tank system at an existing station can cost from several hundred thousand dollars to more than $1 million once excavation, new tanks and piping, dispensers, and lost business during construction are included. For buyers and lenders, tank age and warranty status are not a footnote; they are a near-term capital expenditure that belongs in the projection.

Cleanup funds and diligence

Most states operate petroleum cleanup funds, financed largely by fees on fuel, that reimburse eligible remediation costs for tank owners. State funds collectively spend on the order of $1 billion per year alongside the federal LUST Trust Fund. Fund solvency, deductibles, eligibility rules, and claim backlogs vary widely by state, so fund coverage should be verified for the specific site and state rather than assumed. Environmental site assessments are commissioned separately from market and feasibility work, through environmental consultants, and Phase II sampling is common for active stations.

Per- and polyfluoroalkyl substances (PFAS) are an emerging concern at some fueling sites, largely associated with historic firefighting foam use, and are drawing increasing attention in environmental diligence.

Land use and state policy

A small but growing number of municipalities restrict new gas stations. Petaluma, California became the first US city to prohibit new stations in 2021, and several other California cities followed. For incumbent stations in such jurisdictions, restrictions on new supply can be protective, but they can also limit expansion, rebuilding, or redevelopment rights, which should be confirmed during diligence.

At the state level, California's Advanced Clean Cars II rule, which would phase out sales of new gasoline-only light vehicles by 2035, lost its federal Clean Air Act waiver when Congress disapproved it in June 2025. California and other states challenged the action, leaving the future of state-level vehicle sales mandates in litigation. Other regulatory variables affecting store economics include state flavored tobacco restrictions, lottery and skill game regulation, age verification requirements, and minimum wage increases.

10. Regional outlook

Sun Belt. Texas, Florida, Georgia, the Carolinas, Tennessee, and Arizona combine population growth, rising vehicle miles, high electric vehicle hesitancy relative to coastal markets, and permissive land use for large-format stores. They attract most new-to-industry construction by regional chains and destination operators. The opportunity is strong demand; the risk is competitive saturation, as multiple well-capitalized chains target the same high-growth corridors and suburban interchanges. A site that looks strong today can lose share quickly when a new-format store opens nearby.

Midwest. The Midwest is home to some of the most efficient regional chains, including Casey's and Kwik Trip, strong rural fuel demand, and year-round E15 in eight states, among them Illinois, Missouri and Wisconsin. Net lease cap rates are wider than in the Sun Belt, reflecting slower population growth. Rural and small-town stations here are frequently community anchors, with lower volumes but limited competition.

Northeast and Mid-Atlantic. Dense markets with high land values, older station inventory, and constrained sites. Wawa and Sheetz dominate new formats in the Mid-Atlantic, across Pennsylvania, New Jersey and Massachusetts. Store counts are declining in urban cores, as New York's 2025 figures illustrate, while suburban large-format stores remain strong. Redevelopment value of well-located urban corners can exceed going-concern value.

West Coast. The highest fuel prices in the country, declining in-state refining capacity, the highest electric vehicle adoption rates, the most aggressive state climate policy, and local restrictions on new stations. Fuel volume decline is likely fastest here, but constraints on new supply protect well-located incumbents. Operators with strong foodservice and charging capability are best positioned.

Mountain West and Plains. Colorado, New Mexico, Nevada and the Plains states have long travel corridors that favor travel centers and highway-oriented stores, with diesel and seasonal tourism demand. Rural sites raise the same volume and resilience questions seen elsewhere, and rural program financing is more commonly relevant.

11. Outlook scenarios, 2026 to 2035

The ranges below are an analytical framework for testing site-level projections, built from the published forecasts and data cited in this report. They are not forecasts of any individual property's performance.

Base case. Gasoline volumes decline slowly as efficiency gains continue to outpace driving growth. Electric vehicle share of new sales recovers gradually from its post-credit dip without subsidies. The store count drifts lower as small legacy sites close and fewer, larger stores open. Fuel margins normalize below the 2025 peak but remain well above pre-2020 levels, because operating costs keep the industry's breakeven high. Inside sales grow with foodservice. Net lease pricing for credit tenants stays firm. Credit losses remain concentrated in sites with specific weaknesses.

Upside case. Card fee reform passes and meaningfully reduces processing costs. Margins hold above 40 cents per gallon longer than expected as consolidation continues. Foodservice and loyalty programs lift inside sales faster. Long-term interest rates ease, supporting cap rate compression. Fuel economy standards loosen and slow the pace of gasoline decline.

Downside case. A recession cuts driving, inside spending, and freight activity at the same time. A sustained wholesale price spike compresses margins for multiple quarters while labor and insurance costs keep rising. Electric vehicle adoption re-accelerates through cheaper batteries or renewed incentives. Long-term rates rise and widen cap rates. Tank replacement costs and environmental liabilities overwhelm marginal sites, and overbuilding by new-format chains in growth corridors cannibalizes incumbent volumes.

Indicators to watch

The most useful leading indicators for this sector are gallons per store per month in industry and public company data; the spread between average fuel margins and per-gallon operating breakeven; electric vehicle share of new sales and the fleet age trend; foodservice share of in-store gross profit; the spread between fuel and non-fuel convenience store cap rates; SBA default and charge-off trends by vintage as the fiscal 2020 onward cohorts season; the 10-year Treasury yield; the legislative fate of card fee reform; and the pace of new-format store announcements in specific trade areas.

12. What separates a resilient station from an at-risk one

At the site level, the national outlook matters less than a handful of property-specific characteristics. In our experience evaluating gas station and convenience projects against lender requirements, the resilient site and the at-risk site tend to look like mirror images.

A resilient station has high and stable traffic counts with convenient access from both directions; enough acreage and a large enough building to support foodservice, ample fueling positions, and future adaptation such as charging or a car wash; a proven or credibly projected inside sales mix led by foodservice rather than tobacco; newer, warranted, double-walled tank systems with a clean compliance history; a strong brand or competitive fuel supply agreement; a trade area without an announced new-format competitor or club fuel center within practical reach; and meaningful alternative-use value if fuel demand erodes.

An at-risk station has a small building and site with no room to expand; fuel as the dominant revenue and gross profit line; single-walled or aging tanks nearing the end of warranty; a tobacco-dependent inside business; declining gallons; a new-format store recently opened or planned within the trade area; and limited redevelopment potential due to lot size, access, or contamination.

What a bankable gas station feasibility study must demonstrate

For acquisition, construction, and expansion financing, lenders increasingly expect independent evidence on the questions this report raises rather than sponsor projections. A bankable study for a gas station or convenience store should establish the trade area and its traffic, population, and employment base; map existing and announced competition, including new-format chains and club or hypermarket fuel; derive a defensible fuel volume and inside sales capture; stress fuel margins well below recent peaks and test debt service coverage at each relevant lender threshold; incorporate capital needs such as tank replacement; reflect the findings of the separately commissioned environmental assessments; test sensitivity to long-run fuel volume decline; and state a conclusion of feasibility that follows the evidence, whatever it concludes.

Our gas station feasibility study engagements are scoped to that standard, and the same framework applies to adjacent formats such as car washes and truck stops and travel centers that frequently share or replace fuel sites. Program-specific scope is outlined on our SBA feasibility study consultant page and on the SBA and USDA program pages. For how the analyst assembles the volume and inside-sales evidence, see the gas station feasibility analyst's role; for what a reviewer rejects, see why gas station feasibility studies get sent back; for fees and turnaround, see what a feasibility study costs in 2026; and for the full engagement record, see our gas station engagements.

Gas station feasibility studies by state

State regulation of storage tanks, cleanup fund coverage, fuel taxes, and zoning changes the model more than most national datasets suggest. We prepare gas station feasibility studies in the states below.

• Arizona gas station feasibility study
• Arkansas gas station feasibility study
• Colorado gas station feasibility study
• Georgia gas station feasibility study
• Illinois gas station feasibility study
• Indiana gas station feasibility study
• Kentucky gas station feasibility study
• Louisiana gas station feasibility study
• Massachusetts gas station feasibility study
• Michigan gas station feasibility study
• Mississippi gas station feasibility study
• Missouri gas station feasibility study
• Nevada gas station feasibility study
• New Jersey gas station feasibility study
• New Mexico gas station feasibility study
• New York gas station feasibility study
• Oklahoma gas station feasibility study
• Pennsylvania gas station feasibility study
• Tennessee gas station feasibility study

For projects in other asset classes in the same markets, see our state hubs, including Texas, California, Georgia, Illinois, Michigan, New York, Pennsylvania and Tennessee.

About the author

This report was prepared by Sarrah Allen, MAI, who runs FSC Consulting, Inc., the practice publishing as Feasibility Study Consultant. The team that writes our studies maintains the underlying data infrastructure, including the full SBA loan-level file behind the credit figures in Section 8, a national parcel corpus, aerial imagery, traffic counts, and CMBS property-level performance data. That is why the benchmarks here are computed rather than described.

Related reading: the gas station feasibility analyst's role, why gas station feasibility studies get sent back, truck stop and travel center studies, car wash feasibility studies and the six assumptions SBA lenders challenge first, SBA 7(a) feasibility studies, SBA 504 feasibility studies, who is qualified to prepare an SBA or USDA feasibility study, and the complete feasibility study consultant guide.

Methodology notes and data conflicts

Store counts. NACS and NIQ TDLinx counts physical convenience stores; the Census Bureau counts establishments by primary activity and receipts under NAICS 457110, 457120, and 445131. Figures from the two sources differ for definitional reasons and should not be reconciled by adjustment. This report uses NACS counts throughout.

NAICS transition. Data series spanning 2022 must map legacy codes 447110 and 447190 to 457110 and 457120. Analyses using a single code across the transition will misstate trends.

Fuel margins. Industry average margins reported by NACS, weekly spot margins reported by OPIS, and margins disclosed by individual public companies measure different things. A low-price, high-volume operator will report per-gallon margins well below the industry average by strategy. Annual averages conceal intra-year volatility.

SBA default rates. Published gas station default rates range widely depending on the denominator: share of resolved loans that defaulted, share of all loans charged off including those still active, or dollars lost relative to dollars approved. Young loan cohorts understate lifetime losses. Any default rate cited without its denominator should be treated with caution.

Forecasts versus measured data. EIA price and consumption projections, electric vehicle adoption scenarios, and the scenario ranges in Section 11 are modeled projections, not measured outcomes.

Gaps. Current CMBS delinquency rates specific to gas station and convenience store collateral, the precise national share of gallons sold through club and hypermarket fuel centers, and consistent national data on insurance premium trends for fuel retailers were not available from public sources at the time of publication. Getty Realty operating metrics are cited as of the third quarter of 2025.

Sources

• NACS, U.S. Convenience Store Count, 2026 release (data as of December 31, 2025)
• NACS, U.S. Convenience In-Store Sales Top $340 Billion, April 15, 2026 (State of the Industry, FY2025)
• NACS Magazine, 5 Key Metrics Defining the Convenience Industry's Health, June 2026
• CSP Daily News, U.S. convenience-store count declines for second year, 2026
• US Energy Information Administration, Today in Energy: gasoline consumption, 2026
• US Energy Information Administration, Short-Term Energy Outlook, 2026 editions
• US Energy Information Administration, Annual Energy Outlook
• Federal Highway Administration, Traffic Volume Trends
• US Department of Energy, Alternative Fuels Data Center Station Locator
• US Environmental Protection Agency, Underground Storage Tanks program, semiannual performance data as of March 2026
• US Census Bureau, North American Industry Classification System
• US Small Business Administration, 7(a) and 504 FOIA loan data and SOP 50 10
• USDA Rural Development, Business and Industry Loan Guarantees and Higher Blends Infrastructure Incentive Program
• Electronic Code of Federal Regulations, 7 CFR Part 5001
• The Boulder Group, Net lease research and tenant profiles, Q3 2026
• Getty Realty Corp., investor relations and SEC filings, Q3 2025
• Murphy USA Inc., investor relations and SEC filings, FY2025 and Q2 2026
• Capstone Partners, convenience store M&A market updates, 2025
• Company announcements and trade press coverage (CSP, Convenience Store News, C-Store Dive) of the Couche-Tard and Seven & i proposal, Casey's and Fikes, Sunoco and Parkland, FEMSA and Delek, and RaceTrac and Potbelly transactions
• Nilson Report, US card processing fee data, as cited by merchant trade associations, 2025 and 2026

This report is published for general informational purposes. It is not investment, lending, legal, or tax advice, is not an appraisal or opinion of value, and is not an environmental assessment. Feasibility Study Consultant (FSC Consulting, Inc.) is an independent third-party advisor and is not a lender. Figures are drawn from the public and published sources listed above as of their stated dates and may be revised by their publishers.

To discuss a gas station or convenience store project, request a proposal.