What's Next for Restaurant Business Loans?

Whole business securitizations (WBS) are a big deal in the restaurant industry. They help businesses get loans by bundling together their future earnings. But these loans come with a deadline, called an anticipated repayment date (ARD). This is when the business must pay back the loan, usually by getting a new one. A lot of these WBS loans are coming due soon. Over $7. 9 billion worth, which is more than 20% of the loans rated by KBRA, will need refinancing in the next few years. This means a lot of restaurants will be looking for new loans at the same time.Getting a new loan isn't always easy. Interest rates have gone up by about 2. 3 percentage points since these loans were first issued. This could make it harder for restaurants to meet their debt service coverage ratios (DSCRs). But even with higher rates, most restaurants are expected to be able to refinance. They should still have enough cash flow to cover their debts, with an average coverage ratio of over 2. 5x. However, not all restaurants will have the same experience. Some may struggle more than others, depending on how well their business is doing and what's happening in the market. It's a mixed bag, but overall, the outlook seems positive.