ESI Arranges the Sale of a New Jersey Skilled Nursing Community for $24M

New Jersey - August 31, 2021 - Evans Senior Investments (ESI) successfully represented the sale of a 120-bed skilled nursing community in New Jersey for $24,000,000 or $200,000 per bed.

Built in the last 20 years with multiple renovations since - the community exhibited a modern physical plant with all of the rooms at the community being private or semi-private. Despite the contemporary design, the community was not profitable at the time of marketing the offering, with census averaging 77%, resulting in a net operating loss. Prior to the COVID-19 Pandemic, the community averaged 90% occupancy with 41 short-term rehabilitation residents contributing to revenue of $15,600,000. However, even though the community exhibited stabilized occupancy and a high number of short-term rehabilitation residents, the community did not generate industry average profitability metrics prior to the COVID-19 Pandemic. Contributing to the below-average profitability was the high expense structure in the housekeeping, dietary, and nursing departments. “ESI ran a confidential marketing process to a select group of regional owners/operators and procured competitive offers within 15 days of going to market. The competitive bidding process for a community operating at below-average margins showcases the strength of the skilled nursing market today” commented Henry Fuller, Senior Associate at ESI.

ESI represented the seller, an independent owner/operator who sought to exit the long-term care industry. Jason Stroiman, President and Founder of ESI, commented “This sale presented an exciting opportunity for a new ownership group with operational expertise and synergies in the state of New Jersey to utilize their network of vendor relationships to quickly decrease the expense structure at the community.”

The buyer was an East Coast-based owner-operator of skilled nursing communities who wanted to grow their presence in the state of New Jersey.

Evans Senior Investments continues to observe the difficulty of operating long term care assets in today’s marketplace with rising labor costs and the increasing need for compliance oversight. The continued crisis related to the COVID-19 pandemic will likely intensify the struggles of independent owners as the crisis strains the day to day operations at facilities nationwide. Since March 31st 2020, Evans Senior Investments has closed over $474M in transaction volume, with over $1.6B in transaction volume set to close in the fourth quarter of 2021.