All Forum Posts by: Charlie Cameron

Let's go!!! Stoked about finally finding our perfect niche, assisted living. :)

Hey @Marjorie Josaphat! How big is it? I know of some folks in Cali that may be able to help. 

@Oliver Lee hiya!

We have looked into it just briefly, but we haven't used an SBA loan. They key there is either to have really tight historical breakdown or be able to demonstrate what it is going to be. SBA likes the numbers to be a sure thing. REALLY great product when it is though! Better rates and lower money down. So it might be best when purchasing an existing business that is performing and did good bookkeeping. That last part always seems like the hardest. 

You could also consider a portfolio or investor loan type product from a local bank or DCSR lender and use that for the property while you build up the business and refi to SBA later. The really challenging part is getting the loan on the business - I don't have experience with that but building a network so hopefully I can connect you with someone soon. 

Sup @Joshua Bautista!

My partners and I (I'm a veteran, they're both still active duty for a little bit longer, but our investments are replacing their incomes!) buy assisted living homes and lease them to operators. We may eventually get into operations as well. 

We also run a large assisted living network. Would love to connect and help if i can!

 Morning! Looking for residential homes that can suit max capacity for that locality. (10-14 in most places). 

@Neal Patel (your name is very similar to the SEO guy I follow... I'm sure you get that a lot!). We are interested in smaller residential ALFs if you come across any. We are marketing and buying on and off market.

Hey @Dan V.! We've done a few of these and are actively working on more. If you are essentially doubling the square footage, I'd increase your reno price. Consider the following:

- To maximize rent, you need to maximize what the operator can make, which means making the home as nice as possible for private pay residents and maximizing to the licensable number of residents

- You don't necessarily have to have individual bedrooms, some can be shared, but check on the square footage requirement for bedrooms

- No, $1 in for this type of reno will not equal $1 out. That's the big gotcha on renovating into one of these. Don't expect a full cash out BRRRR. That's why we look for properties that as as close to what we need as possible: we might just need to make things more accessible, add sprinklers, and add a few bedrooms.

- For a nice home where all the residents would be private pay, we are leasing commercially to an operator for 3-5 years for $700-1000 per resident. But the SFR rents are higher than norfolk in most cases, so it may not be quite equivalent. You can rent for even more if the home is more specialized (i.e. memory care, etc.).

Hope that helps! We are looking to expand into Virginia as well. 

@Ian Martin It's going to depend heavily on what the home can be licensed for, the finish of the home, and how many residents it can be licensed for. But it ends up being around 3X the long term rent. 
Having been heavily in short term rentals for a while, I've found this to be about as much work up front, but we don't have to furnish, we don't have the management nightmares that STRs bring, we make as much or more cash flow, and we handle less maintenance than a traditional SFR. We're signing 3-5 year escalating commercial leases, which is awesome.

Generally, what we've been estimating is that if this is a pretty nice residential assisted living home, that we will get $800-1100 PER resident. 

The hard parts are ensuring you can have a home that can be licensed for as many residents as possible (comfortably) and finding a well qualified operator to lease it to. Licensing requirements vary heavily by locality and usually the home will need to have a sprinkler system, bedroom size requirements, there may need to be min distance to any other licensed homes, etc.

Hey @Lexi Blevins! You're going to want to start by checking with local zoning and planning to determine is the home can become residential assisted living. Sometimes it has to be zoned properly or it might need to be a specific distance from an already licensed home.

Then you need to determine the licensing requirements and see if you can meet those. Often times there are bedroom size requirements, residential sprinkler system requirements, among others.

You'll want to then check the state regulation agency and review their requirements and licensing process. 

If you plan to operate the entire business, that will be work. But if there are enough bedrooms or you get multiple homes, you will be able to support hiring a local manager to manage daily operations. 

You can also do what I do and lease the home TO an operator. Make the home licensable and tailored to residential assisted living, and then lease it at a higher than market rate to an operator who will run their own business out of your home. Finding the right operator is the key here but once you do it's passive for 3-5 years as a commercially leased home. They even handle most maintenance and all utilities. Pretty sweet arrangement! 

That's the tool ^^^ Sendhil is a real expert in this space!