Buyers of Senior Living communities have a thorough review process when evaluating acquisition opportunities. Senior Living buyers want to see current and historical financials, census information, Medicaid rates, survey histories, and many other pieces of information about the acquisition opportunity. While each buyer is different in how they like to review deals, here are 5 questions to ask before buying a Senior Living community:
1) Do I know the market? There is a big difference between operating in an urban setting, and a rural setting. A primary market and a secondary market. Knowing how to operate where the acquisition opportunity resides is very important to a buyer.
2) Do I have economies of scale? Buyers who have an established footprint in the area of the acquisition opportunity can recognize many operational efficiencies, which can positively affect their bottom line.
3) Will I need to invest CAPEX to update the facility? If a facility needs work to the physical structure itself (new roof, new flooring, etc.), that will impact a buyer’s consideration and potentially any offer that they would consider making.
4) What’s the culture of the community like? Buyers don’t want to see disgruntled staff, or unhappy residents. Often times when buyers tour facilities, they are noting what the culture of a particular community is like, and that will have a strong influence on their decision.
5) Is there any upside? Buyers want to see what’s in it for them for a Senior Living community they are interested in acquiring. Buyers want to see things like: Adjacent land on the property to expand onto, opportunities to improve upon occupancy with better marketing, a chance to acquire more private pay residents, and opportunities to trim expenses by providing their own ancillary services.
If you are an owner of a Senior Living community and wanted to gain a better understanding of what buyers are looking for, and potentially how they would evaluate your community, please contact Dave Balow at 630.858.2501 or firstname.lastname@example.org.