Deal of the Week: February 20, 2013

MBK Senior Living is doing it again. The company just closed on a 67-unit assisted living community in the Denver, Colorado market, and while they paid a net price of about $285,000 per unit for the relatively new building, that per unit price will drop as they convert some of the larger, two-bedroom units into studios and one-bedrooms. Management believes they can increase the size of the community by 12 to 15 units with this change, and increase the occupancy from 90% to 95%. Given the large size of the community at about 70,000 square feet, this should not be a problem. After all, the more than 1,000 gross square feet per unit is more typical of an independent living community with larger units and more common space. This change should increase revenues by at least $500,000 annually, most of which will fall to the bottom line. The current operating margin is an attractive 35% after management fee, and that should approach 40% by the second year. Not too shabby. Lisa Widmier of Vantage Pointe Capital Management & Advisory represented the seller.....Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today