DETERMINING THE REAL ESTATE VALUE OF A SENIOR HOUSING GOING- CONCERN Presented By Courtney B. Lees, MAI Province Consulting Group, LLC 4 Willow Lane Old.

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Presentation transcript:

DETERMINING THE REAL ESTATE VALUE OF A SENIOR HOUSING GOING- CONCERN Presented By Courtney B. Lees, MAI Province Consulting Group, LLC 4 Willow Lane Old Greenwich, CT (203) – phone

HUD GUIDELINES Board and Care 5% to 15% Assisted Living 10% to 15% Intermediate Care 10% to 20% Nursing Home 15% to 25%

IL/AL HEALTH CARE REIT COVERAGE RATIOS REITYEAREBITDAREBITDARM HCR Ventas HCN NHP HCN2010N/A1.55 NHP Average

NH HEALTH CARE REIT COVERAGE RATIOS REITYEAREBITDAREBITDARM HCR Ventas HCN NHP HCN NHP Average

Model Assisted Living Income and Expenses Revenues$2,520,000 Less: 70%-$1,764, %-$126,000 $350-$21,000 NOI$609,000 Units60 Monthly Revenues per Unit$3,500

Calculation of Real Estate Value Utilizing HUD Allocation Net Operating Income$609,000 Allocation to Business10.00% Indicated Rent to Real Estate$548,100 RE Capitalization Indicated Value to Real Estate$5,481,000 SAY:$5,500,000

Calculation of Real Estate Value Utilizing EBITDAR Multiple NOI$609,000 ADD: Reserves$21,000 EBITDAR$630,000 EBITDAR RATIO1.15 NOI to the Real Estate$547,826 RE Capitalization Rate10.00% Indicated Value to Real Estate$5,478,261 SAY:$5,500,000

Calculation of Real Estate Value Utilizing EBIDARM Multiple NOI$609,000 ADD: Management$126,000 ADD: Reserves$21,000 EBITDARM$756,000 EBITDARM RATIO1.35 NOI to the Real Estate$560,000 RE Capitalization Rate10.00% Indicated Value to Real Estate$5,600,000 SAY:$5,600,000

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