An alternative use investor bought a small memory care community in Williamsburg, Virginia. For some communities, the original layout is simply not conducive to strong operations, whether it be too many studio units, jack-and-jill bathrooms or an inefficient design. Originally built in 2017, this community features three separate cottages with 16 private units in each. That pod model created operational challenges due to staffing regulations from the state, and despite renovating each building in 2022 and 2023, the previous owner, after just three years of ownership, decided to sell.
That seller, English Meadows, had acquired the community in 2021 for reportedly more than $5.5 million, or $115,000 per unit. Values were higher back then, as interest rates were near zero, and perhaps a bit more grace was given for operations to improve, as it was on the heels of the pandemic. Staffing costs had yet to spike, as well. Now, the community is losing nearly half a million dollars on $1.5 million of revenues, with occupancy below 45%, so we imagine it lost value. In fact, the buyer paid $2.05 million, or $42,700 per unit. The non-seniors housing investor plans to convert the community to an alternative use. Toby Siefert and Dave Balow of Senior Living Investment Brokerage handled the transaction.
