Personal Care Community Sale by Brad Clousing

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Personal Care Community Sale

Personal Care Community Sale recently in Georgia by Brad Clousing of Senior Living Investment Brokerage, Inc. This transaction consists of a 41 unit Personal Care Community sale located in Cumming, Georgia. Despite a bankruptcy and a transition in ownership, the asset has performed well under the current interim management company. The asset had experienced volatile swings in performance over the previous twelve months. The census at the time of sale was 80%, the capitalization rate was 8.0% with and EGIM of 2.8X. The property was originally constructed in 1997 and consists of 22,945 square feet. The ultimate sale price was for over $80,000 per unit based upon 41 beds.

Change of Ownership

The bed capacity during the due diligence period was increased to 50 beds and the Buyer has plans for a major cosmetic renovation of the physical plant. The Seller was a California based investment firm that purchaased the asset as part of a non performing loan portfolio acquisition and subsequently foreclosed on the borrower. Senior Living was able to procure a Midwest based regional operator as the Buyer. With their experience with operating personal care homes as well as the increase in bed capacity to 50, the asset should produce future strong perormance and subsequent returns.

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Assisted Living Sale in Georgia

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Assisted Living Sale in Georgia facilitated by Brad Clousing and Jeff Binder of Senior Living Investment Brokerage, Inc. The transaction consists of a 38 unit assisted living sale located in Acworth, Georgia. Acworth is a rapidly growing and strong demographic sub market near Atlanta. The asset was built in 2014 and boasts high end finishes constructed under the new Georgia Assisted Living Licensure standards. The property leased up quickly given the property’s positive reception within the local community and the well planned building with quality finishes combined for 95% census at the time of the assisted living sale.

Transaction Overview

Senior Living Investment Brokerage, Inc. was able to procure multiple qualified offers by implementing a strong marketing effort on behalf of the Seller. The 38 unit assisted living sale was built in 2014 and encompassed 38,646 square feet. The sales price, reflected by the quality construction and care, was $8,400,000 or over $221,000 per unit. The cap rate at the time of sale was 7.75% with a gross income multiple of 3.9X. The Seller was a partnership looking to redeploy assets to new development opportunities. The Buyer was a REIT with the asset to be operated under a long term lease agreement by their affiliate company.

Contact Info

For additional information on this Assisted Living sale or to inquire about the value of your seniors housing property, contact Brad Clousing at [email protected] 630/858-2501 or Jeff Binder at [email protected] 314/961-0070.

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Senior Living Investment Brokerage Sale of ILF/MC Community

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Senior Living Investment Brokerage, Inc. recently facilitated the sale of an 88 unit Independent Living and Memory Care Facility in Texas. The community is comprised of 56 Independent Living units and 32 units/36 beds of Memory Care. The asset is approximately 73,000 square feet and is situated on approximately 24.03 acres of land. The property is located in a town 46 miles southwest of Dallas in Johnson County. The property was originally built in 1988 and renovated in 2003. The overall census at the time of sale was 99%. The cap rate on this sale was 8.9% and the EGIM was 3.17X.

Seller Representation

Matthew Alley of Senior Living Investment Brokerage, Inc. represented the Seller in the transaction. Matt was able to procure multiple qualified offers on the Seller’s behalf. The Seller of this seniors housing community is a local, independent owner operator. The Seller was operating under a forebearance agreement with their lender. The Buyer chosen is a hospital provider headquartered in the Dallas Fort Worth metroplex and owned by funds managed by an investment advisor. For additional information on this sale or to discuss how Matthew Alley of Senior Living Investment Brokerage, Inc. can assist with the sale of your Seniors Housing property, contact Matt at 630/858-2501 or [email protected]

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Have Senior Housing prices peaked?

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Recently, I spoke at the Washington Healthcare Association’s (WHCA) annual conference.  I have spoken there three times on the general state of the senior housing and skilled nursing sales market.   For the first time, I had to say that the data shows that pricing has peaked.   According to the National Investment Center (NIC), prices peaked in mid-2015.   As a firm, Senior Living Investment Brokerage, Inc. sells 90+ facilities each year and we have a very good pulse on the market.  Our data would support this conclusion.  On a facility that we would have received six offers a year ago, we now might receive four.   Prices seem to be down approximately 5%.  However, when analyzing pricing over the past six to eight years, today’s prices are still very good.

The million-dollar question (quite literally!) is, where is pricing going in the future?  Prices are still very good and there are still many buyers with plenty of access to capital.  However, the Federal Reserve has come out recently talking about increasing rates again, which could push up the rate on the ten-year treasury, increasing borrowing costs.   If interest rates continue to rise, we could see a further decline in pricing.   However, we don’t see a dramatic decline in the next 6-12 months.   There are too many good buyers with plenty of capital to invest.   Occupancy is steady and new construction in most markets is not out of line.  Beyond 12 months, it is very difficult to predict and prices could change much more.  For any owner thinking about selling in the next several years, now might be a very good time.

For a market valuation on your senior living or skilled nursing facility, please contact Jason Punzel at [email protected] or Joy Goebbert at [email protected], 630-858-2501.

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