Last week, we took a look at the relationship between the size of the skilled nursing facility and the price it sold at, according to statistics from our just-published Skilled Nursing Acquisition & Investment Report. And like skilled nursing facilities, the larger the seniors housing property, the higher price paid for it, generally. That is because larger institutional properties can take advantage of scale to boost cash flow and thus its value. In addition, the majority IL communities tend to be large and IL has commanded high prices in most years.

There are indeed smaller “boutique” memory care communities that can command a high per-unit price because of the rents they can charge for a “home-like” atmosphere, but they pale in number of sales compared with smaller “B” and “C” properties that sold in 2018, which saw a perfect correlation between community size and price per unit.

The largest communities with 150 units or more sold on average for $253,900 per unit, just off of the $260,100 per unit average recorded in 2017. Properties with between 100 and 149 units followed at $194,400 per unit, while the next smallest facilities, with 50 to 99 units, averaged $189,800 per unit. Finally, the smallest facilities, even consisting of some of those higher-valued memory care communities, sold for the lowest average price of $158,500 per unit. This analysis and much more is now available in The Seniors Housing Acquisition & Investment Report.