The end of April saw a dearth of deals, until this transaction was announced (no price was revealed, but we’ll take it). Looking to expand its presence in the Iowa market, a Northeast-based owner/operator purchased two skilled nursing facilities in the state for $7.2 million, or $37,895 per bed, with an expected first-year cap rate of 13%. The 90-bed facility in the town of Washington was built in the 1970s, but had some renovations 15 to 20 years ago. The Muscatine facility has 100 beds and was also built in the 1970s, with renovations in the late 1990s and early 2000s. Occupancy was 80%, and both facilities had experienced regulatory issues. Despite that, the facilities operated at a combined 12% margin on approximately $9.3 million of trailing-six month revenues (although, there is certainly upside). Mark Myers, Ryan Fleming and Joshua Jandris of Marcus & Millichap represented the seller, a husband and wife partnership exiting the business, in the transaction.
April deal drought
