A lower cost provider of independent living and assisted living services in Spokane, Washington, sold with the help of Rob Reis of Marcus & Millichap. Mostly filled with Medicaid residents (over 70% of the census), this community features 220 licensed beds in 210 units on a 2.9-acre plot adjacent to Gonzaga University.
Previously owned by Pacific Northwest multifamily investor Kinsel Ameri Properties, Inc., the community was 95% occupied and operated at an approximately 18% margin on $5.1 million of revenues. Pro forma figures have the operating margin increasing to 24%, but with such a high Medicaid census and less rent flexibility being the lower cost provider in the area, the ceiling isn’t too high. Washington-based Care Partners Management Group stepped in as the buyer, paying $10.75 million, or $51,200 per unit, at an 8.7% cap rate.
