Selling Your Assisted Living Facility
Whether you want to retire, move away or get into another business, the best option is often to sell your assisted living facility. Unlike selling a residential home, selling an assisted living facility takes more care to plan for and more work to find the right buyer.
Getting a loan to purchase an assisted living facility is also quite different than it is when buying a home. When somebody buys a new home they simple go to any bank or mortgage broker, have their credit checked and income verified, get an appraisal, then close 30 days later. When it comes to purchasing an assisted living facility, buyers must choose a lender that’s experienced and knowledgeable in working with assisted living facilities. In addition to running a credit check and verifying the buyer’s income and available funds, the lender has to do a fair amount of due diligence on the business itself to ensure that the income can support the loan payments. They also have to make sure the buyer is capable of running the assisted living business so they’re able to make their payments. The timeframe to close on an assisted living facility loan is also significantly longer. Most sales take between 90 – 120 days.
Preparing the assisted living facility to be sold
Preparing your assisted living facility to be sold involves more than some fresh paint and a little landscaping. There are many aspects of the business that should be looked at, and possibly adjusted, to make it more attractive to a buyer. While there are professionals available that can help you with this process, there are a lot of things you may be able to do on your own.
Get your finances in order
Having clean books is not only important to the buyer, but it also goes a long way to help the lender review the business and ultimately approve the loan. Make sure that your expenses are clearly categorized and all of the income is accounted for. You’ll also want to make sure that you have financials available for the previous three years.
Once you have your books in order it’s a good idea to review your expenses to see if there are any that you can cut back on to increase profit. Often times, people get comfortable with certain vendors and service providers and don’t realize that they’re paying more than they would elsewhere. You may be able to negotiate better pricing with who you’re currently using, or find a new vendor or service provider that can save you money. You may also see other areas that you can improve, such as groceries, supplies, utilities and wages. Being more conscious of the food and supplies you buy or restructuring staff schedules may be able to add more profit to the bottom line.
Pass of some respsonsibilities
If you’re the only one that knows how to do certain tasks, like accounting or finding new residents, it’s going to be difficult for a new owner to step into the business and continue running it. Start training other staff members on how to do these tasks so the business can continue to run smoothly when you’re gone. Some buyers may not want to spend as much time in the business as you do so they’ll need somebody who’s capable of running things when they’re not there.
We also discuss more ways to prepare your assisted living facility to be sold in more detail in another post.
Determining What Your Assisted Living Facility is Worth
You’ll also need to figure out what your real estate and business are worth, and what they can be sold for. Some sellers make the mistake of asking for too little and leave money on the table, while others ask for too much and are never able to sell. Asking for the right price will help you sell in a reasonable amount of time and get you a fair price. You can hire an appraiser or business valuation expert to get the most accurate valuation, or you can talk to a broker that’s experienced in selling assisted living facilities to get an opinion of value. While an appraiser will give you the most accurate value that a lender will base their decision on, it can be quite expensive. Having a recent appraisal may also help the buyer in their loan approval process and speed up the deal. However, what a property and business are appraised at and what they will actually sell for in the current market may be two different things. Discussing your situation and business with a knowledgeable broker can give you a better idea of what you can expect to be offered for your assisted living facility and will cost much less than an appraisal.
We also discuss determining the value of your assisted living facility in more detail, including different methods of valuation in another post.
How to Sell Your Assisted Living Facility
When it comes to actually selling your assisted living facility, you’ll need to gather the necessary information on the business and property, locate a capable and qualified buyer and navigate the transaction. While some owners choose to sell without the assistance of a broker, most people that go this route can wait several extra months, or even years, to find a buyer and often lose the deal in the middle of the transaction because they aren’t familiar with the process. While selling on your own to save money in commission may sound attractive, it’s important to understand that it can be a very complicated process and, in most cases, sellers walk away with less money than if they would have paid the commission to have the assistance of a broker.
There are around 1 million residents in assisted living. Trying to keep up with all the assisted living residents and your assisted living facility can be daunting without modernization. Here are four ways you can modernize your facility and make it the best it can be for residents and easier for staff members to do their jobs.
Imagine how much time your staff would save if they could get the facility up and running at the touch of an app each day. They don’t have to run around and flip on every single light, every single appliance, every single television—you get the idea. By having smart technology for the appliances and electronics in your facility, a staff member can quickly control things from their pocket, giving them more time to focus on the more important task of taking care of your residents.
While dealing with residents of an assisted living facility is very hands-on, there are certain aspects of the job that don’t have to be. For example, automatic pill dispensers can save a lot of time. There are so many residents in an assisted living facility that giving out pills to each individual person could be extremely time-consuming. An automatic pill dispenser for some of the more able residents could cut the time it takes to do this task in half.
Healthcare software can provide an alternative to keeping data on notepads and spreadsheets, and having centralized information on apps can help your staff keep track of allergies or other health conditions. Just imagine having to sort through a bunch of papers in a file cabinet while your resident is having an emergency. Not only will having centralized information on apps save time, but it can save lives by reducing response times.
New technology is great, but sometimes modernization can be as simple as redecorating and redesigning the facility. This can be especially helpful if your facility looks more like a hospital than a place to live. Beds are one area to look at. Mattress technology is advancing all the time, so getting more comfortable mattresses could be beneficial to the physical health of your residents. Updating the colors, lighting, and furniture can help your residents feel more at home. Modernizing your assisted living facility doesn’t have to be a daunting undertaking.
These four tips provide a great start to a fresh, new, modernized way of taking care of your residents.
Read on a similar topic: Types of Assisted Living Facilities
Getting older is a fact of life. No matter how well you take care of yourself, a time may arise when you need to consider moving to a senior living facility. And even if you are in perfect health, growing older means taking the necessary precautions to prevent accidents and injuries. Before making a final purchasing decision, you need to know that the facility you choose is equipped to take care of everyone else who resides there.
Living by yourself as a senior citizen can be scary. With age comes safety risks, so when you’re looking to buy or to invest in a senior living facility, you want to make sure that it’s equipped with proper alarms for everyone who lives there. A reputable senior living facility should have alert systems installed throughout the community. People should be able to access them easily if needed, particularly if someone were to fall. Even independent living centers for elders who are healthy and full of vigor need that extra peace of mind.
People of all ages can lose their footing, trip, and fall down. However, as people get older, it’s not uncommon for them to become unsteady on their feet. More so for seniors, falls can cause serious injuries. Take note of whether the facilities you tour have handrails installed. They should be in every bathroom, hallway, and staircase. Handrails should also be at the right height, so if someone falls, that person can reach them easily. This simple but effective upgrade should be a top priority.
Alert systems are not the same as an intercom system. While alert systems can call EMS, having an intercom system is also important, especially for seniors with reduced mobility. Being able to call for help, even in the next room, saves lives. If you don’t see one installed, ask whether you’re allowed to install one on your own. If you’re considering buying a unit, there may be restrictions on what you can and cannot do inside the unit or facility.
In addition to these above-mentioned safety features, take note of current residents and staff if possible. Inquire whether there are community activities that encourage positive social interaction. Social interaction is crucial, especially as people get older, to avoid feeling isolated and alone. Finally, ask whether there is a physician on staff. Many senior living facilities do employ both physicians and nurses just in case they’re needed. Take all of these amenities into account as you consider the available safety features at any senior living facility.
If you’re looking to buy an assisted living center property, get in touch with us today!
Safety is one of the most important reasons families decide it is better for aging loved ones to reside in an assisted living facility than in their own homes. There are a number of things necessary for owners of assisted living facilities to understand to make good on this promise of safety. This includes what safety equipment should be available on the premises at all times.
Well-Stocked First Aid Supplies
It is vital to be proactive in your approach to handling any possible injuries and emergencies that might occur. One important first step is to make sure a well-stocked first aid kit is always on hand. Older people possess more brittle bones and thinner skin which makes it necessary for them to receive a higher level of care for minor injuries than other people. According to Family Resource Home Care, your first aid kit should at least include the following:
- transparent film dressing
- self-adhesive bandages
- butterfly closures
- rolled gauze
- paper tape
- nonstick gauze
Fall Prevention Equipment
Falls are a major cause of injuries for people of all ages but can be especially problematic for people who have reached an advanced age. The use of fall prevention equipment can be the determining factor in whether an incident is a minor inconvenience or a life-threatening injury. According to Bohn & Fletcher, assisted living facilities should provide things such as handrails, grab bars, bedding, safe and comfortable seating, and walkers or canes. Fall mats are also useful, especially alongside beds and in bathrooms. Fall management socks are excellent for providing extra traction when walking on slippery surfaces. The handrails and grab bars you purchase will be especially useful in the bathroom where the floor is often moist and residents will have to get in and out of the bathtub.
Your assistant home living facility will provide housing for vulnerable people. Because of this, it is extra important for you to take security measures that will ensure the safety of your residents. According to Keri Systems, perimeter access to the facility should be tightly controlled. This will prevent access by unauthorized people and keep residents from wandering off without the knowledge of you or your employees. There should be a point of contact at each door that makes communication with an employee inside the facility necessary. Only known visitors with a photo ID should be allowed inside. You and your staff will not be able to have eyes on patients at all times. In-patient monitoring systems will allow you to make sure residents do not need assistance while in their rooms. Also, be sure that your assisted living facility has a capable fire alarm system.
Providing for the safety of residents is job number one for you as the owner of an assisted home living facility. There are many things to consider as you work to improve safety standards for your residents. The three tips above will provide you with a solid foundation for making your facility as safe as possible.
If you’re looking to buy an assisted living facility, take a look at our listings!
The Different Types of
Assisted Living Facilities
What are the different types of assisted
living facilities? What are their specialties?
If you’re looking to start your own assisted
living facility, those are two questions you’ll need to ask (and answer).
Essentially, five different groups need
assisted living in some form or another:
- Dementia patients
- The developmentally disabled
- The mentally ill
- The brain-injured (traumatic brain injury,
spinal cord injury, etc)
In this article, we’re going to review exactly
what types of assisted living facilities cater to each group so that you can
have a better idea of the licensing, possible bed rates, demand, and level of
care required to service them.
The Different Types of Assisted Living
Facilities: Focus on the Demographic
“Assisted living” has come to mean a lot of
things. Naturally, it can get a little confusing.
We’ll use the term “assisted living,”
generally but, as you’ll see, you can just as easily replace it with any terms
that encompass the same level of medical care and assistance.
Nursing homes are still technically “assisted
living facilities” because they assist dementia patients with basic living
tasks, so people might refer to their grandparents’ nursing home as an
“assisted living facility.”
However, there’s also a specific name for
facilities that cater to an elderly crowd that doesn’t yet require serious
medical treatment or 24-hour supervision: literally titled an “assisted living
What’s even more confusing is that the name of the assisted living facility that you’re looking to start might vary from state to state – like we noted in our article on “Starting an Assisted Living Facility in Michigan.”
Thus, don’t get hung
up on the terminology. Focus, instead, on
the group of people you’re looking to help. The terminology will change from
state to state, but the people that you’re looking to help will stay the same.
Then, when you’ve found out the type of
facility you want, follow our guides on how to get started with financing for
Seniors: Assisted Living, Board and Care,
Adult Living, Supported Care
It’s a sad fact of life: With old age comes
decreased cognitive functioning and increased dependence on others – even for
the most basic tasks. Everyone, at some point, will reach the age where they
need someone to help take care of them. You and your loved ones are no
Assisted living facilities are designed with
this purpose in mind. Unless they’re connected to nursing homes, they typically
don’t assist people with dementia or other serious illnesses. Instead, they’re
focused on helping the elderly with everyday functioning; nursing homes would
provide too much care, in this instance, and therefore would
probably be too expensive for the care recipient. This way, with these senior
care facilities, the owners don’t need to pay for expensive services that the
recipients don’t actually need.
Some of these facilities are able to get
Medicare, and most of the patients in these types of facilities either pay
privately or they qualify for long-term care insurance.
The level of skilled nursing varies from
facility to facility. Some seniors haven’t yet reached the point where they
need a licensed medical professional to insert a catheter into them, for
instance, while others have. Therefore, it’s important to keep in mind that
senior care facilities vary. Here are some of the different types of assisted
living facilities that are available for seniors who need a little bit of help
but haven’t yet reached the point where they need serious medical care:
- Assisted Living Facilities (also “board and
care,” “adult living,” and “supported care”). The key term here – what assisted living facilities actually
assist with – is called an “activity of daily living” (ADL for short).
According to MedicineNet, typical ADLs include feeding,
bathing, dressing, grooming, work, homemaking, and leisure. As we mentioned
above, the patients in assisted living facilities typically don’t require a
high degree of medical care, so assistance with these tasks can be performed by
anyone with a basic degree of training.
Dementia Patients: Memory Care, Long-Term Care, Skilled Nursing, Custodial Care
According to the World Health Organization, the percentage of adults 60 years and older
living with dementia at any given time is around 5-8%. The total number of
people with dementia is expected to reach 82 million in 2030 and 152 million in
2050. Just like assisted living facilities, there’s a growing market for
facilities that cater toward dementia patients.
And, when it comes to informal caregiving, the
jury is out: When friends, family members, and other relatives are tasked with
the assistance of a person suffering from dementia, both suffer. 98-99% of informal caregivers experienced
problems with trying to
take care of their loved one by themselves – and it ended up seriously
affecting their social lives in the later stages of the illness. A vast
majority of them ended up needing additional professional support anyway.
In fact, according to that same study published in The Open Nursing
Journal, “The amount of available professional care is, however, not
expected to rise in line with the growing demand in the ageing population.”
However, this is good news for those of you looking to start nursing homes and
other care facilities catered toward dementia patients.
Naturally, these facilities demand a higher
level of care: more skilled and more attentive. The facilities themselves are
usually on lockdown to prevent any patient from wandering off, and some of them
have amenities such as aromatherapy, pet therapy, and greenhouses – in order to
keep patients at ease.
- Memory Care Facility (also called “long-term care facilities,” “skilled nursing facilities,” and “custodial care facilities”). These types of facilities demand a higher level of care than simple assisted living facilities. Licensed medical professionals are typically on staff 24/7 to help with patients’ needs. Typically, these have higher bed rates than senior care facilities. Many researchers believe that professional care for those with dementia won’t scale in proportion to the level of demand, so opening a nursing home might be a smart investment.
The Developmentally Disabled: Facilities
Serving People With Developmental Disabilities (FDD), Intermediate Care
Facility for Individuals with Intellectual Disabilities (ICF/IID)
Alternatively, there are facilities designed
with no age requirements – for people of all ages who need some level of assisted
care with their daily activities. Just like most of the other types of
facilities designed for these different demographics, there are varying levels
of expertise required for those living in a facility for the developmentally
For instance, some members are relatively
high-functioning members of society. They might even have day jobs, so they’ll
leave at some point throughout the day. These members only need help with basic
tasks (the ALDs we mentioned above, on the bullet-point for “assisted living
facilities”): cooking, cleaning, keeping their medication organized, staying
above par when it comes to their personal hygiene, and so on.
FDDS: Facilities Serving People with
FDDs help patients learn new skills and
maintain their current skills. According to the Wisconsin Department of Health Services, an FDD:
- Provides active treatment, ongoing evaluation,
planning, 24-hour supervision, coordination, and integration of health or
rehabilitative services to help each individual function at his/her greatest
ICF: Intermediated Care Facility
As you can see, that’s a fairly high level of
care that will likely require licensed medical professionals. Meanwhile, an
Intermediate Care Facility (ICF) does exactly what it sounds like. It provides
an intermediate level of care between basic and intensive. It’s just a step
down from an FDD. From Highland Risk:
- An ICF is typically regarded as a lower-level
nursing care facility when compared to a skilled nursing facility, but its
residents require more care and attention than those in a residential care
facility for the elderly or an adult residential care facility.
As for funding, some pay private, some are
taken care of through Social Security, but most of them are placed in an FDD,
ICF, or lower, more basic facility for the developmentally disabled through
Bed rates are usually less than both senior
care and nursing homes, and facilities for the high-functioning developmentally
disabled, naturally, pay the least in comparison to the others.
- Developmentally Disabled Care Facilities:
Facilities Serving People With Developmental Disabilities (FDD), Intermediate
Care Facility for Individuals with Intellectual Disabilities (ICF/IID), and
other basic facilities for the high-functioning developmentally disabled. These facilities serve all types of people,
not just seniors. Some members of Developmentally Disabled Care Facilities are
high-functioning, so they have jobs that they go to during the day. Facilities
like that, which care for people who need some help but not a lot, don’t make
as much money as the others.
The Mentally Ill: Psychiatric Hospitals, Day
Treatment Mental Health Facilities, Residential Mental Health Treatment
Facilities for Adults or Children, and Separate Inpatient Units in a Hospital
When most people think about mental health
facilities, they assume it’s something like One Flew Over the Cuckoo’s
Nest. Less like a hospital and more like a prison: constantly on lockdown
with a variety of people suffering from severe, debilitating mental
illness – and maybe you could even add electroshock therapy in there, for good
High Demand for Psychiatric Hospitals
Of course, this couldn’t be further from the
truth. In fact, only 6.2% of mental health facilities are
full-out psychiatric hospitals, and psychiatric hospitals, in actuality, are nothing like the
movies. (Sidenote: of that 6.2%, over half are privately owned).
The trend, over the past fifty years, has been
to eliminate psychiatric hospitals in favor of outpatient care – and the data
shows the demand for inpatient care is actually at an all-time high, with
some patients struggling to even find a bed.
The National Association of State Mental
Health Program Directors has this to say:
“The shortage of psychiatric inpatient beds
has become a major national issue, with the lack of availability identified as
a major issue by policy makers, states, mental health families, academics, and
popular media. Many reports regarding these shortages start with the major
decline in inpatient capacity in state psychiatric hospitals—a decrease of over
500,000 beds since the 1950s.”
Meanwhile, mental health problems in the US
are on the rise: Gen Z is more likely than any other generation
before it to suffer from serious mental health issues.
Outpatient Care Facilities: Day Treatment
Naturally, though, just like every other type
of facility on this list, there are varying levels and demands of care. Most
mental health facilities are day facilities. According to the National Mental
Health Services survey, roughly 60.8% of facilities are outpatient, day
treatment, or partial hospitalization facilities.
Thus, each of these facilities will have
different bed rates and qualifications for licensing. Because of the high
demand, psychiatric hospitals will have high bed rates, while others will have
much lower bed rates.
Also, according to Mental Health America, fewer youth are insured for mental health
treatment: “The proportion of youth with private insurance that did not cover
mental or emotional difficulties nearly doubled, from 4.6 percent in 2012 to
8.1 percent in 2017.”
So, there’s a variety of payment methods for
inpatient and outpatient mental health recipients: private, Medicare, and
through a family insurance plan.
- The Mentally Ill: Day Treatment Mental Health
Facilities, Psychiatric Hospitals, Residential Mental Health Treatment
Facilities for Adults or Children, and Separate Inpatient Units in a Hospital. Of these listed, psychiatric hospitals
are the highest in demand. However, because of the rise of mental health issues
across the country (along with care being socially destigmatized), all of them
are viable options for your own assisted living facility.
The Brain Injured: Transitional Care and
Assisted living facilities designed for those
suffering from traumatic brain injury, spinal cord injury, and multiple trauma
are typically labeled as “transitional care.”
Every year, an estimated 1.5 million people suffer from traumatic brain injury. Of
that 1.5 million, 230,000 are hospitalized. That also means there are over 5.3
million people living with a permanent TBI-related disability. The demand for
transitional care (and even occasional outpatient care) is, therefore, fairly
Also, pay can be collected in a number of
ways. Some patients pay privately, some pay through Medicare (depending on the
situation and length of stay), and others pay through auto insurance. Auto
insurance can be difficult to collect on, so be warned.
- The Brain Injured: Transitional Care and
Conclusion: The Different Types of Assisted
Over the years, “assisted living” has come to
mean a lot of different things, so if you’re looking to start an assisted living
facility, it can be difficult to gather research on the different types of
assisted living facilities.
In this article, we clarified that confusion
by focusing on the demographics that each facility serves:
- Dementia patients
- The developmentally disabled
- The mentally ill
- The brain-injured (traumatic brain injury,
spinal cord injury, etc)
You can quickly go through our list and find
names for the type of facility that caters toward each group.
Anyway, we hope our data on the different
types of assisted living facilities will help you narrow down your research.
If you have any
questions, comments, or concerns, contact us today.