Medicare - What no one is talking about . . . yet

So, you have heard me preach about how strong the market is.  I have been on my soap box, jumping up and down, pleading with people to think about what their nursing home or Seniors Housing community is worth.  Now is the time to sell.   Change is coming.  I don't think it is the kind of change that drives pricing up.

1) We know that interest rates and the cost of capital are increasing.  This will inevitably lead to downward pressure on pricing.

2) Our favorite White House is now talking about accelerating Medicare cuts to skilled nursing facilities.  They are looking to cut healthcare spending by $400+ billion over the next 10 years.  In the budget, 2015 brings a 2.5% reduction.

My crystal ball, which is often cloudy, says that as we get closer to the implementation of these Medicare cuts, we may see a correction in pricing.  My advice is to take advantage of the current market.  A market that we are seeing record prices per bed/unit.

If you would like to know what your nursing home or Seniors Housing community is worth, please contact Ryan Saul at ryansaul@slibinc.com.

Skilled Nursing has great demand

Uncertain long-term reimbursement environment.  Legislation risk.  Obamacare extra employee cost.  Difficult surveyors trying to raise more revenue.  You would think skilled nursing would be tough to sell today.  Not the case.  There is a huge shortage of quality skilled nursing facilities for sale right now.  The skilled nursing properties we are fortunate to list today are receiving 6-12 qualified offers in the first couple of weeks with aggressive terms.

The low cost of capital combined with the fact that there will always be a need for the nursing home to take care of the frail elderly lead to huge demand for this product .

If you have thought about selling your nursing home (skilled nursing facility - SNF), please don't miss this opportunity to sell in what many consider to be the strongest market ever.

Contact Ryan Saul for a confidential proposal to find our what your facility is worth.

They will be calling . . . .

More and more companies are hiring people dedicated to calling owners to see if they will sell to them.  Are they calling you?  Do they tell you all about how they are the next best thing to sliced bread?  How confidential they will keep things?  Do they tell you they pay top dollar, can close very fast and have money burning a hole in their corporate pocket?  

They are telling you all this because they want to buy your property for below market!  These buyers are not paying as much for a property that has  market exposure to a pool of qualified buyers.  Instead, they are trying to tie up the property and buy it for below market before it has pricing competition.

Don't leave millions on the table.  Let Senior Living Investment Brokerage, Inc. confidentially represent you in the sale of your facility.  Let us add you the long list of success stories of sellers that had unsolicited offers but after being property represented by SLIB, sold for 30% more.  The market is extremely strong right now with cheap capital and a shortage of quality properties.

Please contact Ryan Saul to learn more how we can help.

Market Gaining Strength

The evidence is there.  The market continues to be torrid.  There is very little supply available, interest rates are at historic lows and buyers are aggressively looking for assisted living and long-term care facilities to buy.

Please join me at this year's NIC Conference September 19-21 in Chicago to network and hear about the current state of the market.  I will be guest speaking and presenting a case study at a breakout session on Thursday where you can hear the variables that impact you as a buyer or a seller.  Learn how we value properties and the variables that come into play in the current market.

Please contact Ryan Saul to discuss the current market and the value of your property.

The Price is Right

Senior Living Investment Brokerage prepares an analysis of what a property is worth using market research and our vast knowledge of the senior housing market. It is important to price an offering that maximizes return for a Seller and also is attractive to Buyers. Upon completion of our analysis, Sellers acknowledge that our value is in line. Rightfully so, every Seller wants to maximize their return. They ask us to list 20%, 30%, even 40% higher than the true market value. They feel that an overpriced property can simply be reduced if it doesn’t sell. The danger with this approach is that many Buyers won't even look at an offering if it is priced too far above market.

A property that is overpriced and has been on the market too long is perceived as tainted. Buyers start to question why it hasn’t sold. A property that is priced correctly generates the most Buyer interest and competition that results in top-of-the-market values.

If you are looking to sell and want to maximize your return on investment, make sure your facility is priced accurately. In the past three years we have sold our offerings for 96% of our initial market valuation. Please contact Ryan Saul for a confidential proposal to determine market value.

Slow time of year? I think not.

I was hoping to slow down, catch up on paperwork and read a good business book this holiday season. That isn't happening. A lot of clients wisely use this time to have a confidential proposal done. That is just fine with me. With all this activity, that means 2012 should be another record year. We are working on a number of closings over the next two weeks and our proposals have increased dramatically. If you were frustrated by the lack of deals out there to purchase over 2011, hold on, I think 2012 will be the year of opportunities. If you have thought about selling, now is a great time to have me do a confidential proposal to see what your property is worth.

Please call me at 630-858-2501 or Email Ryan Saul at ryansaul@slibinc.com to discuss.

Ross Sanders and Ryan Saul Handle Iowa SNF Sale

Ryan Saul and Ross Sanders of Senior Living Investment Brokerage, Inc. sold a 75 bed Skilled Nursing Facility in Grinell, IA. Constructed in 1965 and having gone through a number of renovations and additions over the years, the facility was in overall good condition. At the time of the sale, occupancy was approximately 44% with a Private Pay mix at 30%. No capitalization rate was applicable due to negative income at the facility. The Seller was a regional owner/operator based in South Dakota looking to divest of this underperforming asset. The Buyer is also a regional owner/operator with plans to invest additional capital into the facility, increase overall census and improve profitability through economies of scale. For additional information please contact Ross at 314/961-0070 or Ryan at 630/858-2501.

Jeff Binder Handles Illinois SNF Sale

Jeff Binder has sold a 97 Bed Skilled Nursing Facility in Illinois. The facility was built in 1989 and is located approximately 55 miles northwest of Chicago. The Seller was a national operator/joint venture partnership and the Buyer is a regional provider of long-term care services based in the Chicago MSA. At the time of the sale, census was 75% with relatively high cost centers compared to other Chicago MSA (high quality mix) facilities. The sales price was $6,500,000 ($67,010/bed). For additional information, please contact Jeff Binder at 314/961-0070 or binder@seniorlivingbrokerage.com

Matthew Alley Sells Texas Portfolio

Matthew Alley sold six skilled nursing facilities in Texas for $68,500,000. The portfolio consisted of 894 skilled beds with 54 assisted living units and 17 independent living units at one of the locations ($76,620/bed/unit). The facilities were at 80% census. The facilities, built between 1986 and 2009, were the last six owned by a regional owner/operator. Matthew had been hired to sell six facilities for this group previously. Because of his success and the relationship, he was hired to sell the remaining properties in the portfolio. For additional information, please contact Matthew at 630/858-2501 or alley@seniorlivingbrokerage.com

Upside? What Upside?

The number of potential Sellers exploring the option of divesting has doubled in the last year. So why the lack of quality inventory on the market? The answer, no upside value.

Sellers realize that the lenders and buyers are back in the market aggressively looking for acquisitions. However, the market is not paying for upside. Lenders, appraisers, and buyers are only paying for what your property is worth today. In order for Sellers to maximize their value, my advice is to increase the census, improve cost centers and/or build that valuable program. A buyer won't pay you for the work they will have to do to see that value. If you want the value, improve the cash flow and you will be rewarded accordingly.

Please contact at Ryan Saul for a confidential proposal to determine the market value of your property.