MICHIGAN · NAICS NAICS 7211 family
Michigan hotel and motel projects split between metro business demand in Grand Rapids and Detroit and the resort economy from Mackinac through Traverse City and the northwest lower peninsula. Lender packages turn on a credible third-party study that ties flag standards, average daily rate, occupancy, and revenue per available room to the local trade area, modeling the two opposite seasonality curves separately and stress-testing coverage.
FEASIBILITY TRIGGER
Hotels are on the SOP 50 10 8 special-purpose list, so a third-party feasibility study is normally required, the appraisal must come from an industry-experienced going-concern appraiser, and equity rises to 15 percent, or 20 percent for a startup flag.
SBA 7(a) and 504 lenders funded 481 hotel projects across Michigan between FY2010 and FY2026, moving $823.3 million in approved capital at an average ticket of $1.7 million. That volume places Michigan at #12 of 38 states measured for hotel SBA activity, or 2.4% of national hotel dollars. The 7(a) program carried 78.2% of the loan count, with 504 taking the balance, and 56 approvals have hit the pipeline since FY2024.
| Disbursed loans (FY2010–FY2026) | 481 |
| Approved volume | $823.3 million |
| Average loan size | $1.7 million |
| 7(a) share | 78.2% |
| Approvals since FY2024 | 56 |
| State rank by loan count | #12 of 38 |
Among the 365 seasoned loans in this segment (approvals FY2010–FY2021), 3.3% reached adverse resolution — purchased, liquidated, or charged off. The national benchmark for hotel is 4.4%, against 7.3% across all industries. That performance runs below the national benchmark for this asset class, a credit-positive signal for lenders.
Source: SBA 7(a) and 504 FOIA loan-level data, as of March 31, 2026. Disbursed loans only. See data methodology.
A 3.3% adverse-resolution rate below the national hotel benchmark of 4.4% supports the credit story for well-underwritten Michigan projects in this class. Across 481 SBA loans averaging $1.7 million, that track record does not eliminate the need for a third-party feasibility study, but it means a rigorous study reinforces rather than defends the projections.
Every Michigan hotels and motels project we underwrite follows the same lender ready process: independent market analysis, site and technical review, and financial projections tested against SBA SOP 50 10 8 standards. Our SBA feasibility study consultants guide explains scope, timing, deliverables, and what lenders and CDCs expect in the report.
Michigan projects most often pencil under SBA 504 because the 50/40/10 structure delivers up to 90 percent financing on owner-occupied real estate at a fixed debenture rate, and the state's Collateral Support Program can layer up to 40 percent collateral coverage onto qualifying deals. SBA 7(a) covers acquisitions, working capital, and equipment, and from July 4, 2026 eligible borrowers can combine 7(a) and 504 for up to $10 million in total program credit.
Hotels and motels are Michigan's top-funded SBA category at $55.8 million across 22 calendar 2025 loans averaging roughly $2.5 million, split between metro business demand and a Mackinac-to-Traverse City resort economy whose opposite seasonality a study must model separately.
For a national view of this asset class, see our hotel SBA feasibility overview, and read our related analysis in the hotel lending research on our blog. Lenders and sponsors can engage a hotel feasibility study consultant for SBA loans.
Compare neighboring markets: Massachusetts, Minnesota, Texas.
Public SBA and CDC program records, cited as program evidence
$15,188,000 SBA 504 through TMC Financing
58,370 square foot hotel closed May 29, 2025, national program evidence
Marina, Monterey County, California
SBA 504 partner buyout through Ohio Statewide Development Corporation with LendingClub Bank
Quality Inn property, 2026, national program evidence
Streetsboro, Portage County, Ohio
Fifteen-minute scoping call, written proposal inside one business day, firm fixed fee before you sign.
Book a MeetingOur SBA feasibility study consultants prepare lodging and hospitality studies for lenders, CDCs and sponsors. See pricing, methodology or request a fixed fee quote.
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