A CCRC’s successful SNF

A not-for-profit CCRC in Milwaukee, Wisconsin boasting a well performing skilled nursing facility was sold by Ray Giannini of Marcus & Millichap for $19 million, or approximately $53,670 per bed/unit, with approximately a 9% cap rate. Built in stages in the early 1970s and in the mid-1980s, this CCRC features 187 units of independent living, 80 assisted living units and an 87-bed (62-unit) skilled nursing facility, half of which was recently substantially renovated in 2011, resulting in a good quality mix of about 40%. Altogether, the campus is 90% occupied and operates at a 13% margin (driven largely by the SNF) on about $13 million of revenues. Plus, the previous owner purchased a four-acre adjacent plot of land that could provide for a memory care expansion. With the sale, the seller, Wisconsin-based not-for-profit operator VMP, was able to settle its debt and consolidate its services at its other Wisconsin location, while the Illinois-based private buyer can capitalize on the community’s already good reputation by improving operations in the seniors housing portion and expanding on the extra land.