Hola,
I'm building a senior living technology service. I'm in the late-innings with several opportunities in the assisted living / memory care space. I'm getting unexpected push-back late in the sales cycle around pricing and wanted to pick the brain of those more informed from a financial perspective.
1. In for-profit, private-pay senior living (i.e. assisted living, memory care), can someone confirm stabilized communities have operating margins around 28-38%? Can anyone share anything more on the financials of private-pay, for-profit communities? There is almost no data on the public internet about this industry.
2. Has anyone seen any unique sales / revenue models for service providers that really resonate in senior living? We are replicating the Valet Trash sales / revenue model where the facility purchases the service and then passes the costs down to the consumer with premium. We charge $2.00/day/bed the first year and then $1.00/day/bed when the service is active every year after that. Facilities are to charge however much they want with additional income dropping straight to the bottom line to juice NOI / CAP RATE. Any critique or how I could sell this, financially, even harder?
Any other sentiment or general thoughts from industry experts would be greatly appreciated. Thank you for any consideration fellow monkeys.
Pretty sure I've seen Margins as high as 45% on senior living
Appreciate the anecdote! I confirmed 28 - 35% with one of our installs but wanted to canvass for a few more data points. The industry feels like it's absolutely flush with cash.
Pretty sure you can look through the segment details in the supplementals for WELL and VTR and get this. But yes, those are roughly the stabilized margins.
I did private pay AL IL and MC for a brief period of time on what was mid income housing. Margins were 20-30%.
And margins will vary based on level of care. Higher for independent living and lowest for memory care typically.
Just messaged you!
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