Doing truck stop loans and truck stop financing is a totally different beast than doing loans for gas stations and convenience stores. Make no bones about it, if you’ve found a truck stop for sale, getting a truck stop or travel plaza loan is a pain now.
In many cases the type of individuals that own and operate truck stops and travel plazas are very different people and companies than people who own and operate gas stations and convenience stores. They truly are different than night and day.
It also depends on how you define a truck stop or travel plaza. If you just have a larger than normal sized convenience store with the ability to pump diesel, technically this would be classified as a truck stop, but most likely would not be recognized by long haul truckers as one. It also probably won’t be listed for truckers to buy diesel. Your target market there will probably be short haul truckers and local business that have diesel trucks.
If it truly is a truck stop / travel plaza that is doing major diesel volume (minimum 500,000 – 1,000,000 gallons per month) many will be branded truck stops and yet be independent when it comes to who they purchase diesel from and many will buy spot, meaning they will buy without a supply agreement and will purchase from the cheapest supplier. Many banks do not know how to underwrite this because their mindset is to deal with sites with a supply agreement, especially high volume sites.
If you are a full sized truck stop, travel plaza with CAT scales, restaurant and/or a quick serve restaurant (QSR) like a McDonalds or Wendy’s, showers, truck wash, motel/hotel etc., these will have a LOT less potential lenders. This also means you will probably have less financing options also This will cut out most small local banks because of the size of the loan. This might cut out financing options like SBA because of the size of the loan (SBA currently caps at $5,000,000, whether it is a 7(a) or a 504). If you are a larger operator, you may be ineligible for certain type of government backed financing (SBA, USDA Rural Development) due to the size of the loan or the size of your company
One thing that banks know about truck stops and travel plazas is that if they ever go into foreclosure they depreciate faster than most types of commercial properties. Logically if they foreclose on the property, they will lose more money on the property than they will on other commercial properties.
One mistake that people make is to think that if they have owned and operated a convenience store, they can own and operate a truck stop. If this is a truck stop that is a large convenience store with diesel that is basically serving the local community, that is entirely possible. If they are attempting to operate a full size full service truck stop / travel plaza, they may be in for a rude awakening. With truck stop loans, it is even more important than the borrower can demonstrate the ability or a history of having run and/or managed truck stops / travel plazas in the past.
Traditional types of financing are available so long as the request loan amount is not too high.
- SBA 7(a)
- SBA 504
- USDA Rural Development B&I
- Hard Money / Bridge Financing
- Equipment Financing
Banks will usually not push the loan-to-value (LTV) on a truck stop / travel plaza simply because they probably will be undercollateralized. PetroMAC is qualified to advise in all areas of financing and operations, as well as advising on setting up vendors and suppliers.