In a deal that was anything but ordinary, Ray Giannini of Marcus & Millichap sold an assisted living community plus an adjacent vacant skilled nursing facility in Owatonna, Minnesota for about $2.95 million, or $59,100 per unit. Steele County previously owned both of the buildings and brought in Benedictine Health System (BHS) to manage them.
Built in 2002, the 50-unit AL community was operating decently with a nearly full, all-private pay census and a margin around 15% on $1.5 million of revenues. Since it was county-owned, we imagine there is a lot of room for improvement in controlling expenses. However, at the SNF, BHS had gradually transferred the beds out of the 1970s-era building to other facilities in their portfolio and slated it for demolition. The new owner, a Minnesota-based regional owner/operator, will redevelop the site into a seniors housing co-op. In anticipation of the next-door construction, the assisted living residents have been displaced and will likely return upon the co-op’s completion in the second quarter of 2020.
