An assisted living community in Moberly, Missouri is getting a fresh start, following its acquisition by a Pacific-Northwest operator with a growing presence in the Midwest. Originally built as an independent living community in 2005, the community struggled with census during the Great Recession. That prompted the owner, a regional operator, to convert a portion of the building to assisted living, and while census eventually stabilized (at 93%), the operating margin remained relatively low (at 16%). So, the decision was made to convert the entire building to assisted living.
However, the regional operator’s investors were looking to exit the troublesome asset, and as the conversion completed, they sold the community for $4.2 million, or $95,500 per unit. As part of the deal, the buyer reimbursed the seller $30,000 at closing for some of the repositioning costs. Moving forward, the new owners hope to improve the community’s operating margin, and many of the existing IL residents are expected to convert to higher rates. Of course, easier said than done. Patrick Byrne and Jeff Binder of Senior Living Investment Brokerage handled the transaction.
