Ghost Kitchen and Commissary Feasibility Study for SBA, USDA and Bank Loans

A ghost kitchen is a restaurant without a dining room and a commissary is light-industrial real estate with hoods in it, and the lender underwrites them on different questions. MMCG Invest prepares ghost kitchen and commissary feasibility studies for SBA 7(a), SBA 504, USDA Business and Industry and conventional financing that treat delivery-only concepts as unproven for cash-flow underwriting, value commissary real estate on flex and industrial comparables with the kitchen improvements carried at little contributory value, model tenant turnover at the rates the public record supports, and report the debt service coverage ratio (DSCR) by year under the lender's floor.

The format's 2021 promise has not survived its 2023 to 2025 record. Wendy's ended its plan for 700 Reef ghost kitchens in May 2023. Kitchen United closed all eight of its Kroger units, 44 percent of an 18-unit footprint, and said it would sell or close every physical location and pivot to software. Reef closed its three New York facilities and laid off 53 workers under a state WARN notice. CloudKitchens, with about 60 United States sites in 2022, ran an annual tenant turnover of about 65 percent by Restaurant Business's calculation, and Local Kitchens fell from 13 units at its peak to 9 by September 2025 and to 6 Northern California units by October 27, 2025. No published cap rate or appraisal benchmark for a ghost kitchen facility exists. A lender that is asked to finance a delivery-only concept or the building that houses several of them is being asked to finance a format whose named operators have exited, and the study is written to say what survives that record: the real estate on its alternative use, and the operator on the same unit economics any restaurant must show. The general method and the SOP 50 10 8.1 spine are on the restaurant feasibility study hub.

The study states which of two projects it is underwriting. The first is an operator, a restaurant business that cooks for delivery and pickup from a kitchen with no dining room, whether its own leased space or a licensed stall in a shared facility. The second is a commissary or shared-kitchen owner, a business that builds or buys a building, fits it with hooded kitchens, grease interception, walk-ins and loading, and rents hourly or monthly to food trucks, caterers, packaged-food makers and delivery brands. The operator is a 7(a) cash-flow borrower at the 1.15 times DSCR floor with a lease that matches the loan term. The commissary owner is a 504 or conventional real estate borrower, and the 504 occupancy test applies: the borrower must occupy 51 percent of an existing building or 60 percent of new construction under 13 CFR 120.131, and a commissary whose income is hourly kitchen rental to third parties has to show that it is an operating business rather than a passive lessor under 13 CFR 120.110. The program rules are on the SBA 7(a) feasibility study and SBA 504 feasibility study pages.

A delivery-only concept keeps the kitchen and loses the dining room, and with it the beverage margin, the walk-in customer and the sign on the street, while adding the marketplace commission, which on DoorDash's published partner plans runs 15 to 30 percent of the order before promotions. The study builds the unit statement from the menu, the ticket, the order count by daypart and the channel mix, applies the commission by channel, carries packaging as a cost line, and tests the result against the full-service and limited-service benchmarks on the hub: food and beverage 32.0 percent, labor 36.5 percent and pretax 2.8 percent for full service in the National Restaurant Association's operations report, with the delivery-only concept's labor saving set against its commission load. A virtual brand that runs out of an existing restaurant's kitchen is incremental revenue to that restaurant and is underwritten on the independent full-service restaurant feasibility study or QSR and drive-thru feasibility study page as a sensitivity, not as a stand-alone business. A stand-alone delivery-only concept with no operating history is a start-up on the 7(a) start-up path with the 10 percent injection and a projection the lender will discount, and the study says in its conclusion whether the record supports the projection at all.

A commissary earns hourly and monthly rent from tenants who must, under every health code reviewed, have one. Denver requires mobile units to report to a commissary daily; Houston requires servicing within the 24 hours before operating with receipts kept a year; Texas rules at 25 TAC 228.221 require a central preparation facility and prohibit private residences; California requires mobile food facilities to operate from a commissary under the Retail Food Code. The demand base is therefore the licensed mobile units and caterers in the service area, which the study counts from the health department's permit roll, plus packaged-food makers and delivery brands. Rates in The Food Corridor's 2023 operator survey run $15 to $45 an hour nationally with 42 percent of kitchens averaging $20 to $29; published sheets show $24 an hour on weekdays at WHEDco in the Bronx, $235 for an eight-hour day shift at Entrepreneur Space in Long Island City, and $16 to $20 an hour or $1,200 a month for a dedicated kitchen at Findlay Kitchen in Cincinnati at launch. The study builds the rent roll from hours sold per hooded station per week, which is the occupancy of a kitchen, with turnover at the rate the record supports and a lease-up schedule set on the industrial market rather than on restaurant demand. Regulatory cost is separate: Los Angeles County's commissary plan check for a high-risk facility is $796, Multnomah County's commissary servicing license is $720 in 2026 and $770 in 2027, and Texas charges $125 per facility. Food truck demand for commissary hours is covered on the food truck feasibility study page.

A commissary is a flex or light-industrial build with restaurant systems in it: hoods and make-up air, grease interceptors sized for multiple tenants, walk-ins, three-compartment sinks per station, loading and vehicle wash-down for trucks. The study sources the construction budget from the contractor's estimate and the equipment schedule and separates building cost from kitchen improvement cost, because the collateral section treats them differently. For a 504 loan the borrower contributes 10 percent as an established business and 15 percent as a new business or on a limited-purpose building; a commissary is not on SBA's special-purpose list, but a lender may read a multi-hood kitchen building as limited purpose, and the study flags the question. A rural commissary in a town under 50,000 people is a USDA Business and Industry candidate, with the new-business equity test of 20 percent balance sheet equity or 25 percent of project cost and an independent feasibility study above $1 million, on the terms on the USDA feasibility study page. Equipment-heavy fit-outs are also financed on a 7(a) loan at the ten-year equipment maturity, and the study reports debt service under each structure.

The study reports DSCR as EBITDA over total debt service by year against the program floor: 1.15 times for a standard 7(a) loan, 1.15 times on historical EBITDA for a 504, and the lender's covenant for conventional and USDA debt. The sensitivities for an operator are commission at 25 and 30 percent, order count 10 and 20 percent below projection, packaging and wages 10 percent up, and the loss of one marketplace. The sensitivities for a commissary are occupancy of hooded hours at 50 and 65 percent of the base case, rate at the survey's $20 floor, tenant turnover at 65 percent a year, and a lease-up of 18 and 24 months. The study shows the hours-sold break-even and the number of anchor tenants needed to reach the floor.

No published cap rate or appraisal benchmark for ghost kitchen facilities was found in MMCG's October 2026 review, and the study says so. The defensible approach, which the study takes, is to value the real estate on flex and light-industrial comparables and to carry the kitchen improvements, hoods, grease interceptors and walk-ins, at little or no contributory value to a next user, because a next user of an industrial building is unlikely to be a kitchen. Used restaurant equipment brings 10 to 30 cents on the dollar at auction. For an operator in leased space the collateral is equipment and a lease that is worth nothing to a lender on default. The study separates building value from improvement cost so the lender can see the shortfall before the appraisal arrives.

A MMCG ghost kitchen or commissary study includes the borrower determination and the 504 occupancy and passive-lessor tests, the delivery-only unit statement with channel commissions for an operator or the hooded-hour rent roll with the permit-roll demand count for a commissary, the lease-up schedule on the industrial market, the project cost split between building and kitchen improvement, the capital stack by program, the DSCR schedule with sensitivities and break-evens, the valuation discussion on flex and industrial comparables and a signed conclusion. Standard delivery is nine to sixteen business days; expedited delivery in five to seven is available. Fees begin at $4,900 for a single-operator 7(a) study and run $7,500 to $15,000 for a 504 or USDA commissary. Revisions required by the lender or agency are made at no additional cost under MMCG's written acceptance guarantee. See MMCG's feasibility study methodology and where we work.

The commissary format shares its real-estate method with the competitive socializing venue case, SBA 504, where the building was valued on its alternative use and the operator on venue cash flow, and the operator format shares its unit-economics method with the franchise drive-thru case, SBA 504.