The impact of rising acuity in skilled nursing
The rise in acuity in post-acute care is certainly having its impact in the skilled nursing M&A market. Historically, the range in price per bed for skilled nursing facilities has been approximately $100,00 to $125,000 per bed, according to the 2015 Senior Care Acquisition Report. Every year, there are always sales between $10,000 and $20,000 per bed, with the occasional sale below $10,000 per bed. And there have always been sales above $100,000. But in 2014, while the low price was a typical $9,000 per bed, the high was an astounding $268,500 per bed, resulting in a spread of $259,500. There was also a record number of deals valued over $100,000 per bed, with 19 transactions, which... Read More »What’s the premium for a stabilized facility?
With the general rise in the average price per bed, both stabilized (which we define as having an occupancy rate at or above 85%) and non-stabilized skilled nursing facilities saw an increase in their average price per bed. But as with assisted living, it was the non-stabilized group that posted the larger increase, with a 27% in the average price per bed, compared to just a 6% increase for stabilized properties. Non-stabilized facilities on average sold for $63,900 per bed in 2014, while stabilized facilities sold for $94,100 per bed, with the overall average coming out to $76,500 per bed. The faster rise in prices for these struggling facilities shows that buyers in today’s market may... Read More »High prices for struggling AL communities
You know we are in a strong seller’s market when even the non-stabilized properties are worth on average 68% more in 2014 than in 2013. After hovering around $85,000 per unit in 2012 and 2013, the average price paid for non-stabilized assisted living communities (which we define as having an occupancy lower than 85%) in 2014 was about $139,000 per unit, showing that buyers are worrying less about the potential of filling empty rooms. Maybe all this talk about demographics has convinced many buyers that seniors will be knocking on their door in just a matter of time. Read More »Valuations soar for “A” quality IL properties
The higher valuations in 2014 (according to the 2015 Senior Care Acquisition Report) should surprise no one. The average price paid per unit for “A” quality independent living communities rose 21.8% from $228,200 in 2013 to $277,900. But, the lesser quality deals didn’t hold back either. In fact, the average price paid per unit for “B” properties rose 55.8% from $99,600 in 2013 to $155,200. This goes to show that in today’s market, just about any piece of property will garner interest from a buyer, as long as it can show potential for profits. Read More »What’s the price for quality?
For the past few years, we have separated out the “A” properties from the “B” properties in our statistics based on a few factors (age, size and location). Not surprisingly, the average price paid for “A” assisted living properties was higher than “B” assisted living properties ($244,800 per unit versus $102,300 per unit) by a difference of $142,500. To put it in perspective, the spread in 2013 was only $87,500 ($222,400 per unit for “A” versus $134,900 per unit for “B”). But what was especially interesting was that “A” properties made up about half of the sales in 2014, compared to 2013 when “B” properties were sold three times more often than “A’s”. This means that there were... Read More »Schedule a demo
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