Chicago-based private equity firm, HAN Capital, engaged Blueprint Healthcare Real Estate Advisors to sell Valleyview of Owatonna, an 86-unit, non-purpose-built assisted living community in Owatonna, Minnesota, about 40 miles west of Rochester. The community was a low-cost provider in the area, mainly accepting residents on Minnesota’s Elderly Waiver and CADI waiver programs that allow for sustainable state reimbursement for income-qualified residents. The community’s occupancy peaked in 2020, when it generated approximately $2.7 million and $640,000 in total revenue and EBITDAR, respectively, on a limited private pay census.
Armed with real-time market knowledge of the local competition’s M&A activity, Blueprint quickly approached that community’s new owner with the unique opportunity. Knowing that the competitor historically limited non-private pay resident move-ins, Valleyview represented a key, synergistic acquisition target to increase market share for both private pay and waiver-supported residents.
Blueprint led a direct marketing strategy highlighting the community’s potential to add private pay residents and secured an offer of $7.35 million, or $85,500 per unit, for the community. The transaction closed in March, resulting in a 3.7 multiple on invested capital over its five-year hold period for HAN Capital.
