How do I buy an assisted living facility with no healthcare experience?
Direct answer
In most states you can own a community without a healthcare background, as long as a qualified administrator runs it. Your options are hiring an experienced administrator, hiring a management company, partnering with an experienced operator, or owning the real estate and leasing it to an operator.
What to know
The choice is about how involved you want to be. Hiring an administrator keeps you closest to the business. A management company, at fees typically running 5% to 8% of revenue, handles operations for you. Partnering with an operator shares both the work and the return. A triple-net lease makes you a landlord collecting rent while the operator runs everything.
Plan financing and licensing early. SBA 7(a) loans go up to $5 million with as little as 10% down, and conventional banks typically want 25% to 35% equity. When the operator changes, the new operator must be licensed through the state's change-of-ownership process, which commonly takes 90 to 180 days.
In diligence, focus on what drives performance: occupancy, payor mix, surveys, staffing and the condition of the building.
How Haven helps
Haven works with first-time owner-operators, who typically buy communities of 16 to 50 beds, and with investors who prefer leased properties. See how we work with buyers.