Have you ever thought about assisted living?
Sue Ann and I have known several “older folks” (We’ll just ignore our own ages for the time being!) who have chosen to spend their “twilight years” (nothing to do with the movies) in some very nice assisted living facilities. There are also facilities for people of more modest means.
Anyway, I’ve been thinking that Milam County would be a great home for a middle-class facility for some time. You can soak up that small-town vibe. It’s quiet. Other support businesses are already in place. It’s not far from first-class hospitals in three or four directions, one of the reasons why rural hospitals are an endangered species.
Part of a Deal
They say if you’re in this business, a commercial deal will eventually cross your desk. In this case, the banker called me about a 35-thousand square foot REO property. The property is available for a fraction of the construction basis, which is good because it would take significant investment to transform it into a viable assisted living facility—or anything else, for that matter.
Besides the 35K building in excellent condition, the property also includes two large buildings in various states of deterioration, a power plant, a maintenance shop, other out buildings, and slightly more than eight acres.
Here’s the rub: Part of a deal is not a whole deal. I have the property. I have the bulk of the financing. I have been promised tax abatements. But I still need a viable team to make it all work. There are so many things I don’t know!
It’s Worth What It Makes
In commercial real estate, it’s not what a property costs, it’s what that property can make. After conversion, I believe this property could gross in excess of $50-thousand a month. But the more due diligence I do, the more I understand that I am not qualified to put together this deal without help—a lot of help. There are just too many skillsets involved. I keep going around in circles trying to determine what it will cost to generate that income.
I believe this property could be a good deal for the right set of investors. It would benefit the community I serve. And if I could keep a piece of it, so much the better for me.
So how about it? Any assisted living management people out there in our blogosphere? Or someone with a better idea about how to repurpose these buildings? I’m open to ideas.