Ray Giannini and Anastasia Pilarski of Marcus & Millichap worked together to sell a 47-unit, private pay senior living community in Rice Lake, Wisconsin for $6.5 million, or $138,300 per unit. Owned by a local husband and wife (who also developed and operated it), the campus includes a 19-unit/20-bed Community Based Residential Facility (CBRF) that was built in 2012 to provide memory care services and a 28-unit Residential Care Apartment Complex (RCAC) built in 2004 for assisted living. Set on over 14 acres, there is also the opportunity for additional development.
Occupancy had been in the 90s, and although the facility remained COVID-19 free, it experienced a drop-off in census (to 85% at time of closing) due to the lockdown restrictions. Annualized year-to-date revenues ending November 2020 were around $2.14 million, with $510,000 of EBITDA, resulting in an operating margin close to 26%. That puts the cap rate at around 7.85%, or just above the most recent trailing-four quarter average of 7.6% for the assisted living sector. A Minnesota not-for-profit was the buyer.
