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| Bob Richards Joins as Sales Associate |
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Bob Richards joined Senior Care Realty recently as a Sales Associate. He has more than a decade of experience as a regional sales manager for a manufacturer of construction materials. Bob had responsibility for covering a seven-state region, building sales volume from $300,000 to more than $5 million annually. He takes that same level of drive and determination in serving Senior Care Realty clients. Working with Vice President of Sales Daren Dudgeon, Bob will serve clients in Wisconsin, Iowa and Minnesota. He is a graduate of the University of Iowa where he received a bachelor's degree in business administration. |
| Investing in Senior Care Real Estate - First in a Series |
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One of the more enduring statistics that will come out of the Great Recession is how almost every asset class has seen a severe deterioration in value over the last two years. Senior care real estate has seen a downturn as well, although less severe than other asset classes. Is the worst over? Are the opportunities worth the risks? When will the good times return?
In this series, we will examine different aspects of investing in senior housing. Benefits of senior housing investments, the associated risks, a comparison of senior housing with other real estate classes, and the effects Alzheimer's and other memory impairment disorders will have on the assisted living industry are just some of the topics that we will explore. We already know that the senior housing industry is at the forefront of a tremendous amount of interest and investment:
· The US Census Bureau estimates that by 2030 the population of those 65+ will double. The Bureau reports that the senior population will account for about 20 percent of the US population by 2030, up from less than 13 percent today.
· The Alzheimer's Association forecasts that by 2030 close to 8 million people, 65+ will be affected by the disease, a 50 percent increase from those that currently suffer from the disease.
· The senior care market is driven by the surging senior population and is not directly tied to external factors such as economic growth, unemployment or energy costs. For these reasons, adding senior housing assets to an investment portfolio could increase diversification and lower overall market risk.
· Capitalization rates have been rising in the senior care industry providing excellent entry opportunities for investment and purchase of properties.
Senior Care Realty provides a variety of services to our clients and we can answer your questions about the senior care industry. Visit our web site or give us a call to learn more about investing in senior care real estate.
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| New Listings. New Opportunities. |
Southwestern Wisconsin: 29-unit assisted living portfolio with 31 licensed beds. Excellent cash flow, high occupancy and 17.6 CAP. Priced at $2,900,000. For more information, contact Daren Dudgeon at 877-834-4175 or daren@seniorcarerealty.com.
Tucson, AZ: 9-bed assisted living home currently occupied with 7 residents. The 2,265 SF home features several upgrades and is convenientyly located. Priced at $355,000. For more information, contact Kerri Ciesielski at 877-834-4175 or kerri@seniorcarerealty.com.
Oregon, WI: 3.7 acre downtown site that has been approved for 100-units of Senior Housing. The developer, our client, is proposing a 50-unit facility with an estimated budget of $7M, as well as a possible second phase expansion. The developer prefers to sell the project upon completion to an assisted living provider or investor, or arrange a long-term lease with a qualified operator. For more information, contact Daren Dudgeon at 877-834-4175 or daren@seniorcarerealty.com.
Lodi, WI: 2.0 acre site located across from the brand new Lodi High School and adjacent to the Prairie Health Center Clinic currently under development. The site is budgeted for 40-units of Senior Housing with the option to expand to 60-units. The completed project is estimated at $5M. The developer prefers to sell the project upon completion to an assisted living provider or investor, or arrange a long-term lease with a qualified operator. For more information, contact Daren Dudgeon at 877-834-4175 or daren@seniorcarerealty.com. |
| Profiles in Business |
| Profiles in Business is a regular newsletter column. We'll feature profiles on Senior Care Realty's business partners, clients, lenders, and others in and around the senior care industry.
Keys to Success for BAKA Enterprises: Enjoy and Engage
In just four short years, many of the assisted living properties owned or managed by BAKA Enterprises, Inc., have proven to be the most profitable in their respective communities. Company President Kathy Tegen attributes this enviable performance to two facets of their program of care: residents need to enjoy life and always feel engaged.
BAKA, based in Appleton, Wisconsin, owns, leases and manages senior communities in Wisconsin. The company just started its fourth year and is led by Tegen and business partner Barbara Bittner. The two women have more than 15 years of experience in the senior care industry, in Wisconsin and elsewhere in U.S. senior care markets. The company currently manages 7 properties, 2 in Appleton, 3 in Green Bay, 1 in Kewaunee, and a new facility opening in November in Lakewood.
Through her experiences with Presbyterian Homes, Inc., in Pennsylvania, and SunWest Management in Oregon, Tegen interviewed hundreds of seniors and their families. What she learned she remembered and took to heart. Those lessons guide her company today in providing services according to a social model rather than a medical model. "What is most important are the activities and the food. Our residents want good food and to have fun. The rest - medical care, monitoring and so forth - that's expected. But where we really stand out is in making our communities places where residents have fun and are always engaged." That commitment is seen in such activities as Friday happy hours, lively games such as beer pong and Wii, and a sensory activity that involves a childhood pool with purple moon sand.
Mike Collins and Daren Dudgeon of Senior Care Realty had a role in helping Tegen and Bittner get their start. "Barb and I decided we could do well in this and that the social model had great potential. We made the decision to start with one facility." At the time Senior Care Realty represented an owner with a number of properties, one of which was a 20-bed facility in Appleton. This was three years ago, and Collins drafted that original lease agreement with a clause that provided Tegen and Bittner the opportunity to purchase the facility. The business partners just closed on the sale at the end of August and hope to purchase another property from the same owners next year.
Success in operating their own homes led Tegen and Bittner to begin consulting. "Owners began calling us for assistance," Tegen says. "Among other tasks, we wrote correction plans for facilities that had deficiencies identified by the State and provided training to their staff," she explains. Collins kept referring appropriate people to Tegen because he knew how BAKA developed its programs. One of those referrals was to Cambridge Realty Capital Companies of Chicago which bought four buildings in the Appleton/Green Bay area. Cambridge contracted with BAKA for management services. "We turned them around and today they are four of the most profitable buildings in the region. We stay focused on the social model. Advertising is great but word of mouth carries us and everyone wants to live with us," she explains.
For the future, Tegen and her colleagues are geared for growth and would like to expand at the rate of 100 beds per year. Eventually they would like to have about 1,000 beds in Wisconsin and branch into Minnesota. "We have grown quickly," Tegen admits, "but we will always remain committed to personal attention, and helping our residents have fun and remain engaged." As she recalled from a senior care employer early in her career, she wants her company to "grow where we are planted."
For more information contact Tegen at ktegen@new.rr.com. |
| Phoenix Seminar on Buying and Selling Offers Practical Insights |
| Senior Care Realty offered its first seminar in Arizona on buying and selling assisted living facilities in early September. The seminar was produced in cooperate with Arizona-ALFA. Attendees from as distant as Indiana joined us for a primer on buying and selling assisted living. Both larger and smaller providers were in the audience. While there are some differences between sales involving larger and smaller facilities, many fundamentals are the same for all size of transactions. The seminar is coming back, by popular demand, and will be offered on January 27, 2010. See "Upcoming Industry Events" below for more information. |
| NIC Conference Focuses on Success in a Capital-Constrained Environment |
| Mike Collins and Daren Dudgeon attended the late September NIC (National Investment Center for the Seniors Housing and Care Industry) Conference in Chicago. Although conference speakers provided plenty of gallows humor about the past year, there was a renewed sense of optimism and enthusiasm as well. It appears as though excesses of the recent past are being resolved and some previously overpriced assets are being repositioned. Although many buyers in the current market are bargain hunters, others are returning to the market eager to grow as long as financing is available. What we realized, and want readers and potential sellers to understand is this: what you may have heard in the past, of properties selling for outrageous prices, is not what to expect today. Sellers must be realistic to put a deal together in the current climate. The fundamentals of the industry are strong, and there are many players in the market who want to continue to grow and to serve growing customer demands. |
| Upcoming Industry Events |
· October 21, Arizona ALFA's 7th Annual Fall Conference
We will be attending the Arizona AFLA (http://www.azalfa.org) fall conference in Phoenix, October 21, 2009 at the Black Canyon Conference Center. Mike Collins and our Arizona affiliate Kerri Ciesielski will be available to meet if you are interested in discussing a possible transaction. To schedule a meeting, please call Mike or Kerri toll-free at 877-834-4175.
· January 27, 2010, How to Buy and Sell Assisted Living Facilities
After a successful workshop in September (see above), Senior Care Realty will be hosting a second informational workshop in Scottsdale, Arizona at the Scottsdale Plaza Resort. Registration will open soon. For more details, call Senior Care Realty at 877-834-4175.
· March 24-25, 2010, WALA's 15th Annual Spring Conference
Make your plans to join us at the Kalahari Water Park and Resort in Wisconsin Dells. More information will be available soon. Visit www.ewala.org for updates. |
| Senior Care In The News |
News and Details on senior care sales and developments
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