An Optimal Size for Skilled Nursing?
As the skilled nursing market evolves, lengths of stay and occupancy decline, and new entrants like Mainstreet change the way we view skilled nursing/post-acute care facilities, what is the ideal size of facility now? Based on 2016 sales according to the 22nd Edition of The Senior Care Acquisition Report, the average size of skilled nursing facilities sold dropped for the first time in three years to 122 beds, and was closer to the historical norm of 120 beds. That fell from 130 beds in 2015, and is the lowest since 2013, when facilities averaged 121 beds. The smallest facility sold in 2016 was 40 beds, compared with 30 beds in 2015, while the largest facility sold in 2016 was 744 beds,... Read More »
The Audience Has Spoken
On April 27, The SeniorCare Investor’s Steve Monroe moderated a webinar entitled “Investing in the CCRC and Independent Living Market,” with panelists Breck Collingsworth of Resort Lifestyle Communities, Adam Kane of Erickson Living and Rick Swartz of Cushman & Wakefield. During the wide-ranging 90-minute discussion, which you can listen to here, the panel tackled CCRC valuations, cap rates, the IL/CCRC development market, whether these property types will suffer in the next recession as much as the last one. We also brought in the audience a few times to get their insight. First, we asked which property should have a higher cap rate, 100% independent living or a mix of IL, assisted... Read More »The Price of Age in Skilled Nursing
We have covered the demise of the 40-year-old skilled nursing facility in articles and webinars over the past few years, and the acquisition market has taken notice. In 2015, 52% of the properties sold were 40 years old and older, which made sense since nearly half the entire U.S. inventory of SNFs are this old. By 2016, however, 52% of the properties sold were between 20 and 40 years old, which in many cases are considered to be relatively “new.” This helps explain why the average and median price per bed jumped so much in 2016. The percentage in the newest category (less than 20 years old) remained relatively similar from 2015 (22%) to 2016 (20%). With the newer skilled nursing... Read More »Pay Up, Up North
Once again on the seniors housing side, the Northeast region has topped the charts for the seventh year in a row (per the 22nd Edition of The Senior Care Acquisition Report), rising to new heights at $292,900 per unit, up 46% from $201,100 per unit in 2015 and even up 4% from 2014’s average of $281,700 per unit. With its high land values and construction costs, it is not surprising that the Northeast has the highest prices. Plus, the Northeast properties are generally in heavily populated, wealthier areas, driving rents up. The West, dominated by sales in expensive markets such as Los Angeles, San Francisco and Seattle, not surprisingly was valued second-highest among the regions,... Read More »Adding Value With Memory Care
Over the last two cycles, an interesting trend has occurred in the valuations of assisted living versus assisted living with a memory care component. At the beginning of bull markets, traditional, standalone assisted living communities typically are priced higher than communities with memory care. Then as the bull market strengthens or peaks, the reverse is true, and assisted living/memory care (AL/MC) communities overtake traditional assisted living. This was never more true than in 2016, the sixth year of this bull market. Communities with a memory care component sold on average for $225,400 per unit, according to the 22nd Edition of The Senior Care Acquisition Report, while AL-only... Read More »Schedule a demo
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