Monthly Archives: April 2017

April 18, 2017
Jason Punzel

Pricing Premium for Portfolios vs. Single Asset Sales

Share

Pricing Premium for Portfolios vs. Single Asset Sales– By Jason Punzel

As a company, we sell many senior living and skilled nursing facilities both as portfolios and single asset sales.  Often times we get asked the question “Is there a pricing premium for portfolios vs. single asset sales?”.  In general, the answer is “yes”.  However, it depends on the size of the single asset vs. the size of the portfolio, the location of the portfolio and the make-up of the portfolio.

In general, portfolios are more attractive to buyers if they are in the same general geographic location, are similar in size and quality and are either all seniors housing or skilled nursing.  A portfolio that is more homogeneous makes it easier to manage, efficiencies and economies of scale can be easier to obtain, and it will fit the acquisition criteria of a buyer better.

When comparing prices of an individual asset vs. similar assets that are in a portfolio of multiple assets we typically see a premium of 5-10% for a homogeneous portfolio.  A portfolio allows a buyer to deploy more capital at once, achieve greater economies of scale, enter a new geographic location more easily, and often allows for more attractive financing terms.

Conclusion:

Whether you own one community or several, the first step in determining value is to engage an experienced professional to assist in the valuation and analysis of your property/properties.

For more information about the value of your senior living communities, please contact Jason Punzel at 630-858-2501 x 233 or punzel@slibinc.com.Front View

April 5, 2017
Brad Goodsell

What to Know When Considering Selling a Senior Living Property

Share

The sale of a senior living property is complex transaction, involving both the real estate as well as the business.  As such, there are a variety of factors for owners to consider as they prepare their property for sale.

Choosing the right broker (and brokerage firm), with experience in your area, specific to senior housing can prove to be critical.  Your selected broker will help you price your property in an aggressive, yet realistic approach, safe-guarding your best interests throughout the transaction process.  Considerable analysis should be given to trends of financial statements and current rent roll, as it will effect list/sale price.

In conducting preliminary retirmenthomeproperty evaluations, a qualified broker, specializing in seniors housing, will be able to provide constructive feedback as to any property improvements to be made prior to listing, and if those improvements are likely to increase the sale price.  Additionally, a detailed marketing plan for presenting the property to buyers should be outlined.

Differing from many real estate transactions, confidentiality in the transaction of senior housing cannot be over stressed.  This is due to the fact that sale of the business, and not just real estate is involved.  The meaning ‘confidentiality’ can vary by brokerage, so it is important to properly vet each broker’s process, and how they will safe guard your business’ need for a quiet transaction, away from the ‘ears’ of employees.

The associated timeline for selling a senior living property is often greatly affected by the ‘sale readiness’ of the property, any associated encumberments, as well the quality of buyer pool that your chosen broker provides.  A typical transaction, from beginning of marketing phase to closing takes an average of four to six months.

Conclusion:

At Senior Living Investment Brokerage, the confidential sale of skilled nursing and senior care properties is our singular focus.

For further insights or questions on the transaction process including valuation, marketing and timelines, contact Brad Goodsell via phone (630.858.2501) or email (goodsell@slibinc.com).