Buying a Gas Station on the I-85 Corridor in Opelika, Alabama: An SBA 7(a) Change of Ownership

The primary trade area is the City of Opelika and the I-85 interchanges that serve it. An interchange store draws on through-traffic and local trips, and no radius or drive-time tabulation was available, so the city boundary is the nearest published geography. The figures below describe the customer base a store on the corridor can reach; they do not by themselves size the store's sales.

Three readings matter for the loan. First, growth is real and recent, and faster in the city than in its county, which supports the commuter half of the store's trade. Second, households are small at 2.39 persons and incomes are near the regional middle, which fits a store whose inside sales lean on beer, tobacco, packaged drinks and snacks rather than prepared meals. Third, Opelika sells far more at retail than its population alone would explain, $37,850 per resident in 2022 [1]. The city is a shopping destination for a wider area, and much of that traffic arrives by I-85.

The traffic evidence is the weakest part of the demand case and the most important. The only counts with segment detail date from 2010. They show the interstate carrying about 34,670 vehicles a day between Exits 64 and 62, against 47,570 between Exits 62 and 60 [3]. Exit 64 sits on the lighter stretch, which is consistent with the large-format chains choosing Exit 62 and Exit 58. A 2020 figure of 51,887 vehicles a day for I-85 at Opelika suggests strong growth since 2010, but its source does not say where it was counted [4]. A current ALDOT count with station identifiers for I-85 at the subject's interchange and for the road the store fronts is a lender condition below, and so is any measure of truck volume, which the research did not find.

The employment base is anchored by a hospital, which is steady around the clock, and by manufacturers in the 200 to 999 employee range [5]; our Alabama market page sets that base against the state's other metros. Shift workers are good convenience customers. The Baxter closure, 459 jobs in November 2023, is a reminder that a plant can leave quickly [6]. Seasonal demand from Auburn football weekends and Gulf Coast travel on I-85 is real in kind but was not quantified in any source, so the model carries no seasonal premium.

The subject is a hypothetical operating branded fuel and convenience store on Opelika's I-85 corridor, inside the city. Its interchange, brand, size and age are not specified. The store profile in the model (gallons, inside sales, trading hours and staffing) is an assumption built from industry benchmarks, not a description of any station on the corridor. For an acquisition, the site questions are less about whether the use can be built and more about whether it can keep operating and transfer cleanly.

Zoning

No zoning district was found for any station parcel on the corridor. The relevant precedent is RaceTrac's Exit 62 store, which needed a Planning Commission conditional use approval on May 25, 2021 and the rezoning of a residential lot to C-3 before its plat was approved on October 26, 2021 [10]. If a fuel station is conditional in the district that covers the subject, the existing store may be operating under an older approval or as a legal nonconforming use, and either status limits what a buyer can rebuild after a casualty. A zoning verification letter from the City of Opelika is a lender condition. The Planning Commission meets on the fourth Tuesday of each month at 3 p.m. [25].

The city's package liquor rules adopted on October 6, 2026 set a 1,500-foot separation, a 2,000 square foot minimum and a requirement that package stores sit in centers of three or more tenants with at least 14,000 square feet; they do not apply to beer-and-wine-only sellers [22]. A single convenience store cannot add a liquor package department, so the beer and wine license is the alcohol revenue the store has.

Utilities and taxes

• Water: the Water Works Board of the City of Opelika serves the city; service to the specific parcel was not confirmed.
• Sewer: the City's Wastewater Division operates the system. The sewer access fee rose to $1,700 per equivalent average connection from $1,250 in May 2023 [24]. An operating store already holds its connection; the fee matters only if the buyer expands.
• Electric: Opelika Power Services and Alabama Power both serve parts of the city, per the 2021 Planning Commission record [10]; the provider for the parcel was not confirmed. No natural gas provider was found.
• Sales tax: 9% combined inside Opelika in 2026 [23], collected from customers and not a store expense.
• Property tax: no dated millage table and no tax bill for any station parcel on the corridor were found. The model carries a placeholder of 1.08% of the real estate allocation, and the tax bill is a lender condition.

Traffic, flood and environment

No current ALDOT count with a station identifier was retrievable for I-85 at any Opelika interchange or for the parkways that feed them; the demand section uses 2010 city counts and an unlocated 2020 figure. The flood zone is undetermined. Environmental history is missing too, and for an operating fuel site that is the gap that matters most: under SBA's policy for gas station loans, a Phase I report with tank and line testing records is due on every NAICS 457 property, large loan or small [38]. The number, age and condition of the fueling positions are a site-inspection question for any real purchase.

Payroll. The store never closes: two clerks work the day and evening shifts and one works overnight, 14,600 paid hours a year, at $15.04 an hour, the industry's 2025 average [29], plus 12.0% for payroll taxes and workers' compensation. The average U.S. store carried 19.9 employees in 2025 [29]; this store is a fraction of that size. A salaried manager at $48,000 is charged even if the buyer runs the store, so the coverage test is not propped up by unpaid owner labor. The overnight shift is the price of matching the chains' hours. At this store's volumes the night trade does not pay for it, and the model carries the cost in full.

Card fees. NACS puts card fees at 8.4 cents a gallon on 2023 data [31], and industry card fees reached a record $21.3 billion in 2025 [29]. The model charges 8.4 cents on every gallon and folds card fees on inside sales into the other-expense line.

Property tax. The placeholder of 1.08% applies only to the real estate allocation, because Alabama taxes business property on assessed value and the parcel's actual bill was not found. Small as the line is, it is a condition: the purchase may trigger a reappraisal at the new price.

Other expenses. Utilities for coolers and canopy lighting, insurance, repairs, tank and line testing, supplies, systems and card fees on inside sales start at $134,000. Wages and other costs grow 3% a year; NACS measured total store expenses up 23.3% from 2021 to 2025 [30], so 3% is not generous to the borrower.

Net operating income comes to 12.8% of the revenue line in Year 1 and a little less each year after, because costs grow faster than a mature store's sales. That shape is typical of an established store in a market where the growth is going to newer formats, and it is the reason the purchase price, not the operating plan, decides this loan.

A change of ownership loan under SOP 50 10 8.1 with Technical Policy Updates, effective October 1, 2026, amortizes the business portion over no more than 10 years. The real estate portion may run to 25 years as a separate piece or a blended loan. That split is why the structure above has two tranches with very different debt service per dollar: the business portion costs far more each year than the real estate portion.

Special purpose status offers a way around the split that this case cannot use. When 85% or more of the use of total project cost is real estate and the owner-occupied special purpose property is integral to the business, the whole loan may amortize over 25 years. Gas stations are on SBA's special purpose list. Here real estate is well under that share of project cost, because the price carries goodwill and the project carries inventory and working capital. A buyer who negotiated a price closer to appraised real estate value would pay less and gain the longer term at the same time.

The case prices the loan at its ceiling, Prime of 7.00% from the H.15 release plus SBA's maximum variable-rate spread, or 10.00% [40]. Alabama's 7(a) loans averaged 10.4% across 626 loans and $352.7 million in calendar 2025 [27], so the model is not pricing below the market. With a loan above $150,000, SBA guarantees 75% [37], and the bank rolls the FY2027 upfront guaranty fee into the project [39].

Appendix 15 also caps the debt: total acquisition debt, including seller debt not on full standby, is capped at the business valuation; any excess must be equity [38]. The restructured loan of $1,067,576 is larger than the $1,050,000 price, because it also funds the inventory, the working capital reserve, closing costs and the guaranty fee. This case therefore carries the test as a stated condition: the going-concern appraisal and the business valuation must support total debt of at least $1,067,576, and any shortfall becomes buyer equity before closing.

Three ownership and injection rules bind the buyer. The injection is 10% of total project cost and cannot be reduced or eliminated. A seller note on full standby, other full-standby debt and minority investors together may supply no more than half of the required injection. And the buyer's ownership must pass the March 1, 2026 rule: direct and indirect owners and guarantors who are U.S. citizens or U.S. nationals residing in the country, with no foreign share [36]. Fuel supply agreements also need attention: SOP 50 10 8.1 treats dealer, jobber and supply relationships covered by the Petroleum Marketing Practices Act as franchises [38], so the branded supply contract, its transfer terms and any image requirements are part of eligibility review, a point developed on our branded fuel section of our gas station guide.

Lee County has a deep bench of SBA lenders: 526 7(a) and 504 loans totalling $239,450,372 since FY1991, eight of them to gasoline stations with convenience stores, with PNC Bank (90 loans) and AuburnBank (17) among the most active [26]. The same data show a 23.6% charge-off rate on the county's FY1991 to FY2015 vintages, 55 of 233 loans [26]. Our 7(a) and 504 lending practice explains how lenders weigh county loss history against a single deal.

Appendix 15 sets the rule plainly. For an initial acquisition the floor is 1.25x, measured as historical EBITDA over total post-transaction debt service, on the last fiscal year-end or the average of the last two. And projections are reviewed but cannot meet the floor, except an owner-occupied Special Purpose Property acquisition whose price the appraised value fully supports, where the floor may be met on projections within two years.

As proposed. The illustrative seller earned $186,000 in FY2024 and $175,000 in FY2025. Both years are invented for this example from benchmark economics, and the page says so wherever they appear. The model tests the last year, the lower of the two, because the store's market has been moving against it. On that basis the proposed $1,129,177 loan, with $147,902 of annual debt service, is covered 1.18x. The proposal fails. The two-year average is higher than the last year but still short of the floor at this debt, so the request fails on either basis Appendix 15 allows. For a store whose earnings are falling toward a new competitor's opening, the later, lower year is also the better guide: a lender that leaned on the average would be lending on a year the market has already left behind.

As restructured. At 14.8% equity ($185,448), the loan falls to $1,067,576 and debt service to $139,833, which the FY2025 figure covers 1.25x. The structure meets the equity rule, the size limit and the coverage floor. The extra cash buys nothing but compliance: the store is the same store.

What the projections add. The special purpose exception would let projections carry the loan if the appraised value fully supports the price. It does not help here for two reasons. The price includes goodwill that real estate value alone does not support unless the going-concern appraisal says otherwise, and the projections themselves sit below the floor: the restructured loan is covered 1.23x in Year 1 and 1.20x in Year 3. The projection is the study's measure of the store after the new QuikTrip; the history is the program's measure before it. When the two disagree, the lender should trust neither until 2026 interim statements arrive. If those statements run near the projection, the honest response is a lower price, not a third round of equity.

The research note on what SOP 50 10 8.1 changed for feasibility studies explains why the acquisition floor rose under the new SOP and why projections lost their standing in these deals.

Coverage in Year 3 ranges from 0.49x to 2.09x across the grid. The two drivers are chosen because they are where a single store on this corridor is exposed. Gallons carry the competitive risk: the large formats at Exits 62 and 58 compete on price and food, and every driver they win is a fuel sale lost. Margin carries the cycle risk: second-quarter 2026 margins of 35.1 to 52.6 cents at listed operators reflect a supply shock, not a steady state [32], and same-store gallons fell at three of five listed chains in the same quarter [32].

The useful reading is the diagonal. A store that gives up a tenth of its gallons and a tenth of its margin at the same time, which is what a price war at the next exit looks like, falls well below the point where NOI covers debt service on the restructured loan. A store that holds volume and earns a stronger margin than 40 cents clears the floor comfortably. The lender's real exposure is a combination of lost volume and a return to the low end of the margin range, and that is why the margin assumption is set at mid-cycle rather than at 2026's peak.

1. The history predates the newest competitor. QuikTrip #7183 opened at Exit 62 in late 2025 with 24-hour food and auto diesel [11][12]. A seller's FY2024 and FY2025 cannot show its effect.
2. Round-the-clock competition. RaceTrac and QuikTrip at Exit 62 and the QuikTrip travel center at Exit 58 never close [9][11][15]. The model keeps the store open all night to match them, so the overnight shift is a fixed cost carried on thin night sales; a buyer who cut the hours would save payroll and hand the night trade to the chains.
3. Environmental exposure of an operating fuel site. Tanks, lines and dispensers that have been in service for years are the largest unknown liability, and SBA's gas station environmental requirements apply in full [38].
4. Price allocation. If the appraisal puts more of the price into goodwill than the case does, the business portion grows, debt service rises and the required equity rises with it.
5. Special purpose collateral. A station is worth most as a station. If the store fails, the lender's recovery depends on another operator wanting the site, which the analysis in our note on special purpose property risk treats in detail.
6. Brand and supply terms. A fuel supply agreement may carry rebranding costs, volume minimums or image requirements on transfer, and it is treated as a franchise for eligibility [38].
7. Stale traffic evidence. The only segment counts are from 2010 [3]. If traffic at the subject's interchange has grown less than the corridor's, the volume base is weaker than the model assumes.
8. Manufacturing concentration. The Baxter closure of 2023 removed 459 jobs [6]; a similar loss among the 200 to 999 employee plants would cut the commuter base.
9. Fuel margin cycle. 2026 margins were inflated by a supply shock [32]. The model's mid-cycle 40 cents could be too high in a soft year.