Monthly Archives: September 2016

September 28, 2016
Brad Goodsell

Does Using a Seniors Housing Broker Really Matter?

Share

Everyone is looking to save money, whether at the grocery store, shopping online or selling real estate, saving a ‘buck’ is often the name of the game.  When considering selling a senior living community, the temptation to list a property without a broker, or use a low fee unproven brokerage, can be tempting.  However, it is also important to consider the benefits of listing with a proven seniors housing broker, that provides a track record of past successes within your market.

Senior Housing Broker
Senior Housing Broker

An experienced seniors housing broker, working as part of an established brokerage, can provide access to a qualified pool of buyers with known financial resources.  This is something that is often unavailable to those without a background in seniors housing brokerage.

Some of the benefits of working with an established seniors housing broker include; creative marketing plans to aggressively present the ‘upside’ of your community to qualified buyers, creating a market, and thus maximizing a sale price.  Additionally, if a broker works within a larger collaborative brokerage team, the team will make direct contact with prequalified buyers presenting the property in a professional approach.

Upon procuring qualified offers, brokers will also help a seller select the most attractive offer, considering any contingencies, buyer financing and track record of the acquiring entity.  This can prove invaluable when navigating the complicated transaction of a senior living community, as both the building and business are being sold. We understand the highest offer is not always the best offer.

Conclusion

It is important to consider all the factors within a potential sale, as no two transactions are exactly identical.  While brokerage fees vary, an experienced seniors housing broker can return many times that amount in creating a controlled competitive bid environment for your community, while helping to guide you step by step throughout the process to ensure a timely, smooth and favorable outcome.

Contact Information

To discuss how we can assist you with the sale of your Senior Living Community, contact Brad Goodsell of Senior Living Investment Brokerage, Inc. at 630-858-2501 or goodsell@slibinc.com.  We are available to prepare a no obligation property analysis for you.

September 21, 2016
Grant Kief

Texas Skilled Nursing Facility Sale

Share

Texas Skilled Nursing Facility Sale

Matthew Alley of Senior Living Investment Brokerage, Inc. recently handled a Skilled Nursing Facility Sale in Midland, Texas. The building comprised of 106 skilled nursing beds. The main building was constructed in 1963 and the therapy building was added in 1996. The skilled nursing building is approximately 31,824 square feet and the therapy building is approximately 1,065 square feet. The facility is situated on approximately 2.627 acres of land.

Property Location

Midland is located 26 miles northeast of Odessa, 116 miles south of Lubbock and 149 miles southwest of Abilene in Midland County.

Transaction Overview

At the time of the sale, the census for the skilled nursing facility was 74%. The property had negative EBITDAR so a capitalization rate is not applicable. The Gross Income Multiple was .50X for the Texas skilled nursing facility sale.

The Seller is a Texas based owner operator that focuses on skilled nursing. The Buyer is an independent owner operator headquartered in the Dallas Fort Worth area. Matt Alley was able to procure several qualified offers while overcoming the negative EBITDAR in this Texas Skilled Nursing sale.

Contact

For additional information on this Texas Skilled Nursing sale or to discuss the sale of your seniors housing property, please contact Matthew Alley of Senior Living Investment Brokerage, Inc. at 630/858-2501 or alley@slibinc.com

September 19, 2016
Jason Punzel

Private Pay vs. Medicaid

Share

Private Pay vs. Medicaid – By Jason Punzel

There is often a debate within assisted living as to what model to use, Private Pay vs. Medicaid.   For newer properties in affluent areas, it is very easy to accept only Private Pay residents.  Additionally, for older building in rural or less affluent areas, often times Medicaid is the only payor source that allows an owner to keep their community full with residents.

The debate between Private Pay vs. Medicaid really comes with communities that are 10 – 20 years old, in moderate income areas, that might be over built.  Often times a community starts out as all Private Pay when it is built, but as the community ages and new competition is built, future Private Pay residents go to the new community, leaving the existing community with lower occupancy.  This community must now decide on how to attract new residents to keep occupancy high and often decides to start accepting Medicaid, which typically has 30-50% lower rates, with the idea that a full community with some Medicaid is better than a community with all Private Pay, but low occupancy.  With lower revenue coming in, there is less money to complete new capital projects which results in less Private Pay residents wanting to go to this community and thus, an increasingly higher rate of Medicaid residents.

Different Markets for Assisted Living Communities:

When a community faces lower occupancy because it is no longer the newest community in the market place, it must decide what their future strategy will be.  It might be to do a major capital improvement so it can compete with other newer facilities for Private Pay residents, or to focus more on “middle class” Private Pay residents providing a nice facility with activities and services, but at more moderate rates than the high cost provider that is focusing on the highest end amenities.  The goal would be to keep the community at a very high occupancy at moderate prices.  The final decision might be to allow the community to accept a high percentage of Medicaid residences, while keeping capital projects, amenities and extras at a minimum.  Of course, the community would still strive to give all the needed medical and personal assistance, but extras would be limited.

Conclusion:

It is important for owners to honestly assess where their community fits in the market place and adjust accordingly so it can achieve a high occupancy, be profitable, while providing for the needs of the residents.

Contact Information:

For more information on how Private Pay vs. Medicaid residents affect the value of your community, contact Jason Punzel at 630-858-2501 x 233 or punzel@slibinc.com.

Entrance

September 6, 2016
Brad Goodsell

Senior Living Community Sale, Do First Impressions Matter?

Share

Senior Living Community Sale, Do First Impressions Matter? 

When considering selling a senior living community, do first impressions matter?  Sure, we’ve all heard that you only have one chance to make an impression, but does this apply to real estate?

Senior Living Community Sale
Senior Living Community Sale

During the course of touring properties being readied for sale, I’ve seen all conditions of communities, old and new, well cared for and in need of some much needed TLC.  As such, I believe first impressions do matter and give a lasting ‘picture’ of a given property.

Like most people, I notice the appeal of the landscaping, condition of the parking lot, and even the exterior trim of the building, all before entering the property.  These factors and many others, raise (or in some cases lower) my opinion of the community before even stepping one foot inside.

Regardless of if you’re considering listing your property, making seemingly small improvements can provide a cost-effective refresh.  For instance, power washing the building exterior and sidewalks, adding soft scape and flowers to prominent walkways, and applying touch up paint to doors and entry walls can help refresh a property, making it look well cared for, and possibly more attractive to a potential buyer, not to mention the residents of the community.

Closing

While you will ultimately need to decide what updates you’re willing to make, based on budget, goals and community needs, some basic enhancements can be made at a nominal cost.  The appearance of your community makes a lasting impression, it’s up to you to decide if it will be a good impression, ultimately impacting the sale price.

Contact Information

To discuss how we can assist in your Senior Living Community sale, please contact Brad Goodsell of Senior Living Investment Brokerage, Inc. at 630-858-2501 or goodsell@slibinc.com.  We are available to prepare a no obligation property analysis for you.