Montana is not the most active acquisition market, but buyers still want to invest there. A regional owner/operator with just one community in Montana decided to exit the state, and hired Jason Punzel, Brad Goodsell and Vince Viverito of Senior Living Investment Brokerage to handle the sale.
Located in Butte, the community has 159 units with 164 licensed beds and was built in 1997 with 87,086 square feet on 11.26 acres. There are 42 independent living units, 102 assisted living units and 15 memory care units. Occupancy suffered in 2021 at 60%, which resulted in lower revenues and EBITDA than one would normally expect. For the first six months of 2021 annualized, revenues and EBITDA were $3,986,000 and $528,000, respectively.
The purchase price was $18.2 million, or $114,465 per unit and a price to revenue of 4.56x. The cap rate was not a market cap rate because of the low census. The buyer is a western-based owner/operator looking to expand in the Mountain West, and will look to renovate the community, optimize staffing and make a push to increase census.
