A New Truck Stop at I-20 Exit 498, Terrell, Texas: An SBA 504 Feasibility Case

Truck-stop demand comes from the interstate, not from the residents of the town that hosts it, so the primary trade area is the I-20 corridor from Exit 498 to Exit 509, about ten miles, plus the local distribution centers that send trucks onto it. FHWA's national model sizes truck parking demand from truck-hours of travel on a highway segment and assigns 77% of it to commercial truck stops, the rest to public rest areas [44]; hours-of-service rules, an 11-hour driving limit after 10 hours off and a 30-minute break after 8 hours of driving, decide where drivers stop [60]. Neither input was available for I-20 at Terrell: the truck share of the corridor's traffic was not found. The demand case therefore rests on generators and growth.

Terrell sells more at retail per resident, $58,894 in 2022, than its incomes would suggest, and it booked $204,683,000 of transportation and warehousing receipts the same year [4]. Both numbers describe a regional hub. Its economic development president put the job base at 14,000 in 2024, for a city that then had about 20,000 people [7]; the city draws workers from across the county every day. No traffic count for I-20 at Exit 498 with a TxDOT station identifier was retrieved; TxDOT publishes its annual counts in a public dataset that the research did not query [2]. A count from TxDOT itself, with its truck share, is the first lender condition below.

The generators are what make Terrell different from a typical interstate exit. Cross-dock buildings exist to move trailers in and out; the Amazon center and the two VanTrust cross docks will add trucks that start and end their trips within a few miles of Exit 498. The three VanTrust buildings and Amazon's ITX7 alone add millions of square feet of logistics space within a few years [28][30]. Local trucks buy diesel and park between loads, and many of their drivers want food and showers without driving east to TA at Exit 503.

Two discounts apply. First, the Amazon figures conflict: the state filing shows 1,160,399 square feet, the newspaper roughly 1.2 million, and an earlier filing 933,656 [27][28][29]. The study uses none of them as a volume input; they establish that a large facility is coming, not how many trucks it sends. Second, speculative buildings fill on the market's schedule, not the developer's. The model therefore phases diesel volume up over three years and reaches its stabilized level only after both projects are due to finish.

For scale on what a destination fuel stop sells, Buc-ee's representatives said in June 2026 that a typical Buc-ee's travel center does $25 million a year in gross sales and sells 18 million gallons [32]. That store excludes trucks, and its number is a company-wide claim, but it shows how much of the car traffic at Exit 498 is spoken for. Seasonality and events specific to the corridor were not found; the model treats freight demand as steady.

The subject is a hypothetical site of about 12.0 acres near the I-20 and FM 148 interchange, inside Terrell city limits; no particular tract is assumed. Its zoning district is a condition to confirm: it must be a district where the city's use chart lets a truck stop apply for a Specific Use Permit [1]. The acreage is roughly what a comparable Love's build used of a 30-acre site in Rock Falls, Illinois [40]. The case assumes access from FM 148 or the I-20 frontage road; the actual frontage and ramp configuration are lender conditions. The site, its size and its zoning are assumptions.

Zoning and entitlement

Terrell's zoning ordinance, as amended by Ordinance No. 3138 on September 30, 2025, lists Use #416, Truck Stop and Fuel Station, with an "S": a Specific Use Permit is required, and the use is permitted by right in no district [1]. The use chart's district column for that "S" could not be resolved from the published PDF, so the city's confirmation that the site's district is one where the permit is available is the first entitlement condition. The same chart marks some uses "R", prohibited within 700 feet of the IH 20, US 80 and Spur 557 rights-of-way in the Highway Corridor district [1]; whether Use #416 carries that mark was not determined, and it matters for any site near the interstate.

Two recent hearing cycles show the timetable. A Specific Use Permit for a wrecker and salvage use went to the Planning and Zoning Commission on September 25, 2025 and to Council on October 7 [24]. A later notice posted November 25, 2025 scheduled Commission and Council hearings on December 18, 2025 and January 13, 2026 [25]. Commercial permits then go through the city's online portal [26]. Entitlement is a matter of weeks once the application is complete; the risk is the vote, not the calendar, and truck stops draw the noise, air and litter objections FHWA's 2026 handbook documents [60].

Utilities, traffic, flood and environment

The research found no water, sewer, electric or gas provider for land at the interchange and no impact or connection fee schedule. A truck stop with showers, a kitchen and a truck wash is a heavy water and wastewater user, so provider letters with capacity confirmation are conditions. No TxDOT count with a station identifier was found, and the truck share of I-20 traffic was not found. Flood zone: not determined. Environmental record: none at all. Truck stops fall in NAICS 457, and SBA's environmental policy asks for a Phase I report on every such property, whatever the loan amount [55].

Taxes

Kaufman CAD's adopted 2025 rates for property inside Terrell sum to $2.423473 per $100 of value: Kaufman County $0.334478, road and bridge $0.080635, Terrell ISD $1.130500, the City of Terrell $0.764200 and Trinity Valley Community College $0.113660 [33]. An independent rate map shows the same total for the city zone [34]. At that rate property tax is one of the largest fixed costs a new truck stop carries.

Payroll. About 26 full-time equivalents run the store, food court, fuel desk and housekeeping around the clock: 54,080 paid hours at $15.04, NACS's 2025 hourly average for the convenience channel [47], plus 12.0% for employer taxes and workers' compensation. A general manager and an assistant add $140,000. The headcount is lean against chain benchmarks; Love's put 55 full-time jobs into its Rock Falls travel center [40].

Card and fleet-card fees. 8.4 cents on every gallon of diesel and gasoline, the NACS card-fee figure for 2023 [46]. Fleet-card programs charge truck stops their own fees, and a site that wants fleet business has to accept them.

Property tax. The 2025 in-city rate of 2.42% on an appraised value of $11,000,000 [33]. The value is set below cost on the view that special purpose improvements seldom appraise at cost; for scale, Kaufman CAD carried Buc-ee's, a much larger store at the same exit, at $15,909,580 in 2020 [13]. Even below cost, the tax line is a large fixed charge in the model.

Other expenses. Insurance for a 24-hour fuel site, power for the store and a lit truck court, hot water for showers, repairs, tank testing, scale certification and supplies start at $540,000 and grow 3.0% a year.

At stabilization the truck stop keeps 20.3% of revenue (fuel margin, inside sales and services) as NOI, $1,113,311 in Year 3. A cross-check from the largest public owner of travel-center real estate puts that in proportion: the 175 TA and Petro sites leased from Service Properties Trust covered their rent 1.20 times at the end of 2025, on annualized minimum rent of $264,262,000, and one master lease covered only 1.05 times [38]. Those are mature, branded sites averaging far more parking than this one, and their coverage was already thin.

SBA 504 splits a project three ways. The October 1, 2026 rules (SOP 50 10 8.1 with Technical Policy Updates, in force since October 1, 2026) set the standard split at Third Party Lender 50%, debenture 40%, borrower 10%; debenture 35% at a 15% contribution and 30% at 20%. The borrower's contribution starts at 10%, rises to 15% for a new business or a limited or special purpose property, and to 20% for both [50]. SBA defines a special purpose property as a limited-market property with a unique physical design, special construction materials, or a layout that restricts its utility to the use for which it was built, and gas stations are on its list of examples. A truck stop with tanks, canopies, a scale and a truck court fits the definition, and a business that has not opened is new. The sponsor's proposal of 15.0% reads the rule as if only one surcharge applied, and it fails the equity test.

At 15.0% the proposal also fails the size test. The debenture would be $5,582,189, above the $5 million limit for a project that is not a small manufacturer. At 20.0% the debenture falls to $4,783,535, under the program limit, and the bank lends $7,972,559, 50.0% of cost.

The debenture rate is 6.97%, the 25-year effective 504 rate from the October 8, 2026 pricing, which folds the ongoing program fees into the rate [54]; the actual rate is set when the debenture is sold. The bank rate is an assumption of 8.25%, Prime of 7.00% plus 1.25 points for a special purpose start-up [57], with the 10-year Treasury near 5% in September 2026 [59]. Both amortize over 25 years. The bank may well ask for a shorter term on a truck stop, which would only raise debt service.

Two more program rules bear on the sponsor. SBA's 504 jobs standard is one job per $95,000 of debenture; the case's staffing of about 26 full-time equivalents falls short of that ratio on a debenture of this size, so the CDC would have to qualify the project under a community development or public policy goal. And under the ownership rule in force since March 1, 2026, the borrower must be wholly owned by U.S. citizens or nationals living in the United States, a test its guarantors share [37]. How CDCs and banks split the risk on a project like this is set out in our practice note on SBA 7(a) and 504 lending.

The 504 coverage standard is 1.15x, and a new business has no history, so the engine tests the projection in Year 2. As proposed, at 15.0% equity, the project fails all three tests: the contribution is below the tier, the debenture is above the limit, and Year 2 coverage is 0.68x. As restructured, at 20.0% equity with the debenture under the program limit, two tests pass and the third still fails at 0.72x.

The engine then looks for an equity share that would clear the standard and finds none. That is a structural result, not a rounding one. In the 504 split, cash the sponsor adds above the tier reduces the debenture; the bank's first lien stays at half the project. On this project, the bank's annual payment alone is more than Year 2 NOI can cover at the standard, so even a sponsor who paid for the entire debenture portion in cash would not pass. The only paths to a passing structure are a smaller project, a cheaper one, or a store that earns more in its second year than the market evidence supports.

The determination is therefore that the market does not support this loan. That is not the same as saying the market does not support a truck stop. The demand evidence for Exit 498 is strong: a growing city, a growing county, three logistics projects and only one full-service competitor in the corridor. What fails is the basis: interchange land near the top of the corridor's range and a 2026 build cost, financed with half the project in a bank loan that needs coverage from the second year. The lender's answer is to send the sponsor back to the land.

Diesel is the business, so both axes are diesel. Year 3 coverage on the restructured loan runs from 0.55x to 1.46x. Only the lower right corner of the grid clears the standard, and every passing cell needs diesel volume or margin above plan, most of them both. A margin near the top of the NACS range together with strong volume is a good year at a truck stop, not a plan, and the grid is drawn for Year 3; the program's test year is Year 2, when the site is still ramping. The top left shows what a soft freight year with fleet-price competition from TA and QuikTrip would do: coverage of 0.55x, near half the debt service.

The grid makes the land argument in numbers. Only optimistic combinations of volume and margin close the gap at this cost, while a lower cost basis would move every cell up at once.

1. Land basis. At the assumed $250,000 an acre, land is one of the three largest lines in the budget, and the true price is unknown until an appraisal and a contract fix it.
2. Entitlement. A truck stop needs a Specific Use Permit in every district [1], and the 700-foot restriction near IH 20 may apply.
3. Chain entry. Love's is adding 20 stores and 1,500 truck spaces in 2026 [39]; a chain site at Exit 498 or a neighboring exit would compete on parking, loyalty and price.
4. TA's scale at Exit 503. 300 truck spaces and five service bays at Exit 503 [8] set the driver's default stop.
5. Industry margins. Pilot's 2025 pre-tax earnings fell by more than two-thirds [43], and one TA master lease covered rent only 1.05 times [38].
6. Construction cost. Inputs rose 8.9% and diesel 77.8% in producer prices in a year [45][52]; fixed-price bids are a condition.
7. Logistics timing. Amazon's center completes in August 2027 and VanTrust's Phase 1 in Q2 2027 [28][30]; delays push the volume the ramp depends on.
8. Environmental liability. A new site starts clean, but every tank, line and dispenser is an exposure the lender inherits [55].
9. Special purpose collateral. If the truck stop fails, the buyer pool is other fuel operators, and the land price paid will not come back. The special purpose property risk note covers what lenders recover from failed fuel sites, and why the trade area is the study explains why a corridor, not a town, defines this one.