Chicago, Illinois – June 1, 2015 – Opened in 1968, Shoreline Health and Rehab, a skilled nursing facility, underwent a $3,000,000 renovation to its first floor in 2012, driving a purchase price of $6,625,000 for the 106 bed facility despite struggling to increase occupancy above 80% in recent years.
Located in Shoreline, Washington, Shoreline Health and Rehab modernized its lobby and added new lighting and hardwood floors throughout the facility. The first floor now includes 40 private rooms, allowing the facility the opportunity to market to Medicare short-term rehab patients in a much greater capacity.
“Although well-managed from an expense perspective, the facility historically had difficulty driving census above 80%. The remodel and conversion to more private rooms is projected to attract more residents and a higher census over time, particularly Medicare Part A residents due to the facility’s spacious, first floor, therapy room,” explains Kristy Ortwein, Exit Strategy Specialist for ESI.
Evans Senior Investments (ESI) worked with the seller to develop a pro-forma of the facility, demonstrating the enhanced profitability of the facility under new ownership and an improved census. The facility currently has a 77.2% occupancy and a 27.7% quality mix.
ESI showcased the property to a select group of buyers and procured a dozen letters of intent from private REITs, public REITs and private equity firms. In a competitive bidding process, a publicly-traded REIT emerged as the winner. The in-place cap rate of the facility was 8.7% on the trailing twelve months NOI of $578,000 and a 12.15% cap rate on the pro-forma NOI of $805,000, demonstrating the value created in communicating the facility’s operational potential to a buyer.
About Evans Senior Investments
Evans Senior Investments (ESI) is the only senior housing investment banking firm that provides customized, innovative solutions to maximize profitability for senior housing business owners. We provide free, fully personalized exit strategies and valuations. We’ve worked with over 500 senior housing businesses in all 50 states and are experts in skilled nursing, assisted living and independent living businesses.
Contact
Adam Jenkins, CRM Marketing Manager
Evans Senior Investments
ajenkins@evansseniorinvestments.com
Phone: 312-896-0123
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