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Has anyone considered investments in seniors care facilities? Seems to me there is a solid demand, but I`m sure there are certain things to consider which are unique to that ownership,but perhaps it`s viable?
seniors care facilities
- Thread starter RisingWealth
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QUOTE (RisingWealth @ Jan 17 2009, 03:42 PM) Has anyone considered investments in seniors care facilities? Seems to me there is a solid demand, but I`m sure there are certain things to consider which are unique to that ownership,but perhaps it`s viable?
Senior care facilities are a great way to occupy your commercial or residential estate. Though there are some particulars involved. Caring for older people requires trained staff, and depending to what level of services you want to offer, professionals in the medical field. Your establishement must abide to safety standards and certain guidelines must apply if you are to be accredited as a legitemate care facilitie. This is a business just like any other, preferably if you are a nurse, educator or doctor and have some understanding of what it takes to care for seniors, this could alleviate some of the responsabilitys on which you will have to depend on other people.
Senior care facilities are a great way to occupy your commercial or residential estate. Though there are some particulars involved. Caring for older people requires trained staff, and depending to what level of services you want to offer, professionals in the medical field. Your establishement must abide to safety standards and certain guidelines must apply if you are to be accredited as a legitemate care facilitie. This is a business just like any other, preferably if you are a nurse, educator or doctor and have some understanding of what it takes to care for seniors, this could alleviate some of the responsabilitys on which you will have to depend on other people.
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QUOTE (alexh @ Jan 18 2009, 12:30 AM) Senior care facilities are a great way to occupy your commercial or residential estate. Though there are some particulars involved. Caring for older people requires trained staff, and depending to what level of services you want to offer, professionals in the medical field. Your establishement must abide to safety standards and certain guidelines must apply if you are to be accredited as a legitemate care facilitie. This is a business just like any other, preferably if you are a nurse, educator or doctor and have some understanding of what it takes to care for seniors, this could alleviate some of the responsabilitys on which you will have to depend on other people.
I`m sorry but I guess I wasn`t clear about investments in senior care facilities. I was refering to purchasing units within the facility.They are avalilable for purchase or rental and What I do know about them is that a senior can purchase or rent one and it can include up to three meals a day, inhouse recreation, day trips, a guest room, and various levels of medical care, etc. Typically the care facillity owns the majority of the rental units, but there are also units owned by re investors and put into the rental pool. They rent from between $1800->$2000/month and this would likely include some meals, activities and the strata fees, usually around $700. So as an invester it may be similar to owning a condo and renting to a student that is, you have a select rental group with unique requirements. I`m just wondering if anyone else is invested in these and if they are a fundalmentally sound investment or am I missing some facts.
I`m sorry but I guess I wasn`t clear about investments in senior care facilities. I was refering to purchasing units within the facility.They are avalilable for purchase or rental and What I do know about them is that a senior can purchase or rent one and it can include up to three meals a day, inhouse recreation, day trips, a guest room, and various levels of medical care, etc. Typically the care facillity owns the majority of the rental units, but there are also units owned by re investors and put into the rental pool. They rent from between $1800->$2000/month and this would likely include some meals, activities and the strata fees, usually around $700. So as an invester it may be similar to owning a condo and renting to a student that is, you have a select rental group with unique requirements. I`m just wondering if anyone else is invested in these and if they are a fundalmentally sound investment or am I missing some facts.
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QUOTE (RisingWealth @ Jan 18 2009, 09:51 PM) I`m sorry but I guess I wasn`t clear about investments in senior care facilities. I was refering to purchasing units within the facility.They are avalilable for purchase or rental and What I do know about them is that a senior can purchase or rent one and it can include up to three meals a day, inhouse recreation, day trips, a guest room, and various levels of medical care, etc. Typically the care facillity owns the majority of the rental units, but there are also units owned by re investors and put into the rental pool. They rent from between $1800->$2000/month and this would likely include some meals, activities and the strata fees, usually around $700. So as an invester it may be similar to owning a condo and renting to a student that is, you have a select rental group with unique requirements. I`m just wondering if anyone else is invested in these and if they are a fundalmentally sound investment or am I missing some facts.
Hello RisingWealth,
It is probably a good idea to calculate your cash flow, determine your responsibility, potential liability or risk if any involved.
Good luck!
FHC
Hello RisingWealth,
It is probably a good idea to calculate your cash flow, determine your responsibility, potential liability or risk if any involved.
Good luck!
FHC
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QUOTE (FHC @ Feb 3 2009, 09:18 PM) Hello RisingWealth,
It is probably a good idea to calculate your cash flow, determine your responsibility, potential liability or risk if any involved.
Good luck!
FHC
I forgot to mention that I am planning to convert a residential property into a senior housing similar to a condo without any added services or facilities. I still have to check the zoning, government requirements, etc. But, is there anybody who already ventured on this? Any government financing I can avail of?
Thank you for sharing your thoughts/experiences.
FHC
It is probably a good idea to calculate your cash flow, determine your responsibility, potential liability or risk if any involved.
Good luck!
FHC
I forgot to mention that I am planning to convert a residential property into a senior housing similar to a condo without any added services or facilities. I still have to check the zoning, government requirements, etc. But, is there anybody who already ventured on this? Any government financing I can avail of?
Thank you for sharing your thoughts/experiences.
FHC
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I own several units in a senior assisted living facility and was on it`s board of investors (rental pool and condo board) for several years. I bought the first unit as a pre-build purchase - I guess I wasn`t part of REIN in those days (7 years ago). Initially the start-up of this 147 suite facility was rough despite a reservefund that provided an income cushion. It took nearly 3 years of none to slightly negative cashflow before things turned around. Also, appreciation was slow because it was an unknown approach and banks are (still) reluctant to finance investors. Personally, I never had that problem because I had a mortgage broker who knew his job.
Over the years I added several units - the second unit I bought when the building started to cashflow consistently with 60% occupancy and the last one I bought February 2008. Now I get consistent good cashflow with a cap rate around 6% (after all the extra costs such as nursing, food, etc.). The operation is very complex and you need a very good rental manager one that is specialized in senior housing. It is very hard to find an manager/operator that is capable of handling a nursing staff, food facilities, the regional healthcare authorities (enormous bureaucratie - beyond believe), building issues (we had 3 sprinkler breaks and nearly $1 million in damage only partially recovered from the insurance), marketing and profit driven investors.
The building has now 189 occupants with monthly turnover of 4 to 7 (deaths or move-outs to higher care). Nursing staff is over 60 plus kitchen and cleaning stafff. Accounting is beyond belief with the healthcare authorities demanding that workhours are tracked in 5 to 10 minute increments.
Overall a promising demographic future, we`re 100% occupied with waiting list. Despite ever increasing costs (we`re Calgary!) and limited rental increases - who wants to be known as gouching poor seniors in the newspapers - we`re doing good; it is my best cashflow stream but also a lot of special headaches.
I hope this helps.
Over the years I added several units - the second unit I bought when the building started to cashflow consistently with 60% occupancy and the last one I bought February 2008. Now I get consistent good cashflow with a cap rate around 6% (after all the extra costs such as nursing, food, etc.). The operation is very complex and you need a very good rental manager one that is specialized in senior housing. It is very hard to find an manager/operator that is capable of handling a nursing staff, food facilities, the regional healthcare authorities (enormous bureaucratie - beyond believe), building issues (we had 3 sprinkler breaks and nearly $1 million in damage only partially recovered from the insurance), marketing and profit driven investors.
The building has now 189 occupants with monthly turnover of 4 to 7 (deaths or move-outs to higher care). Nursing staff is over 60 plus kitchen and cleaning stafff. Accounting is beyond belief with the healthcare authorities demanding that workhours are tracked in 5 to 10 minute increments.
Overall a promising demographic future, we`re 100% occupied with waiting list. Despite ever increasing costs (we`re Calgary!) and limited rental increases - who wants to be known as gouching poor seniors in the newspapers - we`re doing good; it is my best cashflow stream but also a lot of special headaches.
I hope this helps.
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QUOTE (gwasser @ Feb 4 2009, 09:47 AM) I own several units in a senior assisted living facility and was on it`s board of investors (rental pool and condo board) for several years. I bought the first unit as a pre-build purchase - I guess I wasn`t part of REIN in those days (7 years ago). Initially the start-up of this 147 suite facility was rough despite a reservefund that provided an income cushion. It took nearly 3 years of none to slightly negative cashflow before things turned around. Also, appreciation was slow because it was an unknown approach and banks are (still) reluctant to finance investors. Personally, I never had that problem because I had a mortgage broker who knew his job.
Over the years I added several units - the second unit I bought when the building started to cashflow consistently with 60% occupancy and the last one I bought February 2008. Now I get consistent good cashflow with a cap rate around 6% (after all the extra costs such as nursing, food, etc.). The operation is very complex and you need a very good rental manager one that is specialized in senior housing. It is very hard to find an manager/operator that is capable of handling a nursing staff, food facilities, the regional healthcare authorities (enormous bureaucratie - beyond believe), building issues (we had 3 sprinkler breaks and nearly $1 million in damage only partially recovered from the insurance), marketing and profit driven investors.
The building has now 189 occupants with monthly turnover of 4 to 7 (deaths or move-outs to higher care). Nursing staff is over 60 plus kitchen and cleaning stafff. Accounting is beyond belief with the healthcare authorities demanding that workhours are tracked in 5 to 10 minute increments.
Overall a promising demographic future, we`re 100% occupied with waiting list. Despite ever increasing costs (we`re Calgary!) and limited rental increases - who wants to be known as gouching poor seniors in the newspapers - we`re doing good; it is my best cashflow stream but also a lot of special headaches.
I hope this helps.
I am glad you shared your first hand insight into this complex area. We have two parents in two separate facilities and they are struggling with the concept of owning over renting and they are not thrilled about having a mortgage in this stage of life even when I have shown them that with a mortgage they will have more money in their pocket each month. I thought that perhaps I could look at this area to specialize in and rent to them while I`m at it. So far I found that in one case there are no rentals allowed and at another, the facility is purchasing as many of the units for sale as they can so that have their own rental pool.
It`s also worth noting your observation regarding the burereacracy as this may be a source of trouble for an invester/landlord.
Also when you say that you need a good rental manager, are you talking about property management or the in house manager/strata?
My view is that the boomers will provide a strong rental demand that could be a good long term investment but much more research would be the order of the day.
Much success with yours in Calgary,
Mark in BC
Over the years I added several units - the second unit I bought when the building started to cashflow consistently with 60% occupancy and the last one I bought February 2008. Now I get consistent good cashflow with a cap rate around 6% (after all the extra costs such as nursing, food, etc.). The operation is very complex and you need a very good rental manager one that is specialized in senior housing. It is very hard to find an manager/operator that is capable of handling a nursing staff, food facilities, the regional healthcare authorities (enormous bureaucratie - beyond believe), building issues (we had 3 sprinkler breaks and nearly $1 million in damage only partially recovered from the insurance), marketing and profit driven investors.
The building has now 189 occupants with monthly turnover of 4 to 7 (deaths or move-outs to higher care). Nursing staff is over 60 plus kitchen and cleaning stafff. Accounting is beyond belief with the healthcare authorities demanding that workhours are tracked in 5 to 10 minute increments.
Overall a promising demographic future, we`re 100% occupied with waiting list. Despite ever increasing costs (we`re Calgary!) and limited rental increases - who wants to be known as gouching poor seniors in the newspapers - we`re doing good; it is my best cashflow stream but also a lot of special headaches.
I hope this helps.
I am glad you shared your first hand insight into this complex area. We have two parents in two separate facilities and they are struggling with the concept of owning over renting and they are not thrilled about having a mortgage in this stage of life even when I have shown them that with a mortgage they will have more money in their pocket each month. I thought that perhaps I could look at this area to specialize in and rent to them while I`m at it. So far I found that in one case there are no rentals allowed and at another, the facility is purchasing as many of the units for sale as they can so that have their own rental pool.
It`s also worth noting your observation regarding the burereacracy as this may be a source of trouble for an invester/landlord.
Also when you say that you need a good rental manager, are you talking about property management or the in house manager/strata?
My view is that the boomers will provide a strong rental demand that could be a good long term investment but much more research would be the order of the day.
Much success with yours in Calgary,
Mark in BC
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QUOTE (RisingWealth @ Feb 4 2009, 11:03 AM)
Also when you say that you need a good rental manager, are you talking about property management or the in house manager/strata?
My view is that the boomers will provide a strong rental demand that could be a good long term investment but much more research would be the order of the day.
Much success with yours in Calgary,
Mark in BC
Hi Mark,
The rental manager is also the building- or condocorp- manager. It is specialized in senior assisted housing and has now close to a decade of experience under the belt. Unfortunately, we were the guinnea pig. Some of our investors also invested in a similar outfit near Red Deer where the management was hopeless - they fired that management and use now our manager as well. The Red Deer investors are now in recovery mode. Our managers now run a few other similar properties as well throughout Canada.
Your demographics idea is good. That is why I bought. Problem was so did a lot of others during the early 2000s and we were temporarily overbuild in Calgary. That is now resolved.
FYI here is our website link: http://www.whitehornvillage.com/
Godfried
Also when you say that you need a good rental manager, are you talking about property management or the in house manager/strata?
My view is that the boomers will provide a strong rental demand that could be a good long term investment but much more research would be the order of the day.
Much success with yours in Calgary,
Mark in BC
Hi Mark,
The rental manager is also the building- or condocorp- manager. It is specialized in senior assisted housing and has now close to a decade of experience under the belt. Unfortunately, we were the guinnea pig. Some of our investors also invested in a similar outfit near Red Deer where the management was hopeless - they fired that management and use now our manager as well. The Red Deer investors are now in recovery mode. Our managers now run a few other similar properties as well throughout Canada.
Your demographics idea is good. That is why I bought. Problem was so did a lot of others during the early 2000s and we were temporarily overbuild in Calgary. That is now resolved.
FYI here is our website link: http://www.whitehornvillage.com/
Godfried