The ABCs of the Independent Living Market
For some years now, we have separated out the assisted living and independent living M&A markets into a couple of quality-based categories, classified as “A,” “B,” and “C” properties. The determination is made by the property’s age, location and size, and there are always going to be some properties that can fit into either category. But they should balance out in the end. Some owners of “A” properties do not believe it is an apples-to-apples comparison between the quality of their communities and “B” and “C” communities in general, and probably vice versa. That is because the rates that “A” communities can charge and the margins they can operate at often exceed those of “B” and “C”... Read More »
Does Size Matter in Seniors Housing?
Last week, we took a look at the relationship between the size of the skilled nursing facility and the price it sold at, according to statistics from our just-published Skilled Nursing Acquisition & Investment Report. And like skilled nursing facilities, the larger the seniors housing property, the higher price paid for it, generally. That is because larger institutional properties can take advantage of scale to boost cash flow and thus its value. In addition, the majority IL communities tend to be large and IL has commanded high prices in most years. There are indeed smaller “boutique” memory care communities that can command a high per-unit price because of the rents they can charge... Read More »
Did Skilled Nursing Investors Pay for Size in 2018?
The skilled nursing market has been going through many changes in recent years as it adapts to new reimbursement policies, shorter lengths of stay and more medically-complex patients. But did all of that affect what buyers will pay for size in 2018? Well, according to the 2019 Skilled Nursing Acquisition & Investment Report (available soon), there was a perfect correlation between size of nursing facility sold and the average price per bed for the second year in a row. Historically, larger facilities have commanded the higher prices because of their ability to scale, lower the per patient costs and fill beds with Medicaid patients at will. However, those advantages may soon backfire... Read More »
What Happened To Assisted Living Prices?
The assisted living sector fell back to earth in 2018 and dragged the rest of the seniors housing sector with it, according to the soon-to-be-published Seniors Housing Acquisition & Investment Report. Following three successive years of steady increases and a record-high price per unit in 2017 of $221,250, assisted living properties sold on average for just $186,400 per unit in 2018, a 15.8% decline. What could have happened in only a year to cause such a fall? Partially, it was because the share of communities with either 100% or some component of memory care units (which are usually valued higher for their higher rents and more need-based residents) fell from 70% of all communities... Read More »
Non-Stabilized SNFs Drop in Value
We are fast approaching the publishing of our Senior Care Acquisition Reports, which we’ve split for the first time into the Skilled Nursing Acquisition and Investment Report and the Seniors Housing Acquisition and Investment Report. You can expect these Reports to hit your desk sometime in the next few weeks, if you order them, of course. In them, we’ve included more graphs, stats and analysis than ever before, along with comprehensive lists of the industry’s operators, private equity firms, REITs, lenders and brokers. Here is a taste of what you’d find: Source: The 2019 Skilled Nursing Acquisition and Investment Report Traditionally, we have defined stabilized occupancy for skilled... Read More »Schedule a demo
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