Private equity firm O&M Investments acquired a value-add skilled nursing facility in the Dallas, Texas market. At face value, this appears to be a good opportunity for O&M to generate a healthy return.
First, the facility is relatively new at just 13 years old, with improvements made in 2010. Second, it recently converted a wing of the facility to skilled memory care, which should improve quality mix (currently at 16%) and revenues. Because of the conversion, the facility currently operates with 104 out of 124 licensed beds, with 83% occupancy based on the functional beds. Finally, the facility is located in an affluent, inner suburb of Dallas (Richardson), which certainly doesn’t lower the property’s value.
The seller, StoneGate Senior Living, hired Heavenrich & Company to handle the transaction, which ultimately yielded a $6 million, or $58,000 per operational bed, purchase price.