All Forum Posts by: Al Boettger

Suggest you contact Vern Harris at A better Way RE in Colorado-Yes I know you want AZ and he is CO, but he is a go to for RAL purchase info, throughout US

Go straight to the source for a full telling of details.  In your state is RAL, the residential assisted living academy, they do 3-day trainings, and have a lot of info.  They can give you info on this "niche" as some like to call it, but I refer to it as a "calling".  Lots of folks are under the "set-it-and-forget-it-with-a-hired-manager-in-place", but this is a 24-7-356.25 situation, and these are someone's loved ones you are entrusted with.   Find out, and perhaps go work in one for a little while to see if it is really for you.  Beyond that, you can invest passively: buying a home, upfit it (with such things as sprinklers, wider doorway/hallways, lots of bedrooms), and then rent it to an operator.  Or if you want to be active, then you either rent from such a landlord as above mentioned, or own the building-in one entity, and operate under a second.

I suggest you go to RALNA.org which is the Residential Assisted Living Network Association.  On their site, there is a home locator function.  Go to the area you are looking into and find facilities there.  Then reach out to them.  You want this.  Most of the time, this is not a "competition" thing.  Facility operators network, keeping up on the latest laws and trends.  It is also in their best interest to have contingency plans in place in case of evacuation, meaning, they might have cross agreements, which were led to by connecting initially.  In their circles, they also may know who is tired and thinking of selling, and so on.  

Quote from @James Marks:

I have a 4/4 house that would be perfect to operate a residential assisted living facility out of. I just don’t have the time or knowledge to operate one. What would be the best way to market this property to another RAL operator to sublease from me?

One possible idea is go to ralna.org Which is the residential assisted living national Association based out of Arizona. They have a home locate there which you could use to see what homes are in your area and reach out to those businesses perhaps looking to expand or know someone that might be interested.

How about something along the lines of “… The price tendered is subject to revision pending receipt of actual cash  flow information”?

Quote from @Kim Hopkins:

Hello! 

We have a great prospective property we're looking at. The broker OM says they're selling it at a 7.5% cap rate and $5.7m purchase price. 

Based on our experience, We are pretty sure their expenses are understated (they're at 23% of gross income and almost always are closer to 30%). 

They also have a sloppy typo where rent roll totals $410k on the rent roll page but is shown as $420k on the page where they use it to calculate NOI and purchase price (which would make a huge difference in offer price!)

We want to tie up the deal and show them that we're willing to do it at a 7.5% cap rate on the correct numbers, but we can't get the correct numbers until we're in contract and we don't want to retrade If the numbers were misstated (that never goes well in our experience).

Has anyone ever written an LOI that says something like this:

Buyer and seller agree that the purchase price is calculated by applying a 7.5% cap rate on actual annual income and and expenses and any decrease in NOI actuals from the OM will be reflected in an adjusted offer price.

Any ideas? Best way to handle this kind of situation? 

You can take part in it live if you go to meet up, and look for Denver Area Assisted Living Residences, a Mr. Vern Harris, and get the link sent to you.  You can also find it on FB, to see it live tonight, as well as previous meetings.  Best wishes.

Not yet, but am on my way.  Have taken the managers classes, and working on my flip deck for fundraising.  This is a lifestyle though, unless you partner with a person who will run it, and you are ready at any moment to be 'pressed into service" should there be call-outs, I am not of the opinion that it is all "set it and forget it" in terms of manage the manager.  Suggest you also consult Brett Chotkevys of PALM  assisted living in Austin TX, and his info/feedback on the day-to-day in the life of an ALF/ALR owner operator.  

Yes, I have been there, and it was very edifying.  I came away with a good understanding of Assisted Living although it was basically the "30,000 foot view".  I had the option when done of either signing up for their mentoring or getting info from other sources on my own.  I opted for the later, as I "...had the $60K but did'nt know where it was-that sounds better then I didnt have it right?  My contact info is in my bio if you want to speak individually.  I have done that several times now and glad to help.  Also tonight (every last Wednesday night of a month) at 7PM (local-Denver Colorado time) there is a meeting of DAALR, which is the Denver Area Assisted Living Residences group.  It is basically a meet up over zoom for those involved, or seeking to be in Residential Assisted Living.  I will be there, and usually do not miss a meeting.  It is 30-mins of networking, then a speaker for approx 60mins, which if you join the group on facebook, you can catch the recording if the time zone thing does not work for you.  

Yes!