Owning an ALF, or Assisted Living Facility, is a great investment and provides added security to your checkbook. As with all great investments, there comes a time to decide to sell, whether for personal reasons or if the market is showing promise. But when and how do you sell your ALF to get the most value out of it? What are the trends? Read on to find out the last ten years worth of tracking and selling data, along with where to turn to get your ALF for sale in Florida underway.
The Factors of Buying an ALF
There are 1,989 assisted living facilities in Florida alone. And we all know that ALFs are a necessity, especially with the great Boomer generation continuing to age and the Gen X’ers behind them. There’s a lot of different factors that go in selling and buying an ALF, but typically the highest buying point for anyone is when they’re going to see a return on buying the ALF in the first place. Having an idea of the facility’s ROI value upfront goes a long way into someone buying it, knowing they will recover the money from the purchase relatively soon.
Obviously profit and value are top of the list, but you’ll want to consider these other topics as well in your own ALF to increase it’s selling potential:
- Established suppliers of inventory, along with backup inventory
- Predictable key drivers of new sales
- Volume stats with growth potential
- Stable or growing traffic from a variety of sources
- High percentage of repeat sales and visitors
- Clean legal history
- A brand with legal, trademark or copyright
- Documented system and processes
In looking at data over a ten year span, the average ALF in the US sold for about 3.61 times earnings, and facilities were anywhere in the $50,000 price range to ten million dollar valuation range. The average sale price was more around $643,000, and the median home sale price was around $263,000. But don’t fret if your ALF for sale in Florida may be in a different price bracket than these numbers, as the market is increasing each year with more people in general and the fact that they’re all living longer. Showing how stable your ALF is will be a great tool in showcasing that your facility is blossoming, and ready to continue earning any future buyers more money.
How to Sell Your ALF
Whether you’re ready to retire, have done enough that you can with your ALF, are looking for a change, or have another business, investment or opportunity come knocking on your door, you’ve decided it’s time to sell. Before you begin the process of valuing your facility, though, take into consideration these questions, which can help you dive deeper into a true asking price that’s fair to the buyer but still maximizing your profit:
- What are the sales and profit?
- What are the growth trends?
- What are the factors in driving up sales and is it sustainable?
- Where are the new customers coming from and what is that breakdown?
- Is your location favorable?
- What is your market position?
- How reliant is the business on the owner?
- What systems and procedures are in place to run the facility?
Since 2018, the highest selling ALF’s were the ones in the $0-250K range, but if your facility is quite a bit bigger, don’t worry; on average, the bigger the facility, the bigger the value. When there is an increase in revenue, generally your multiple gets higher, leading to a better return on your investment.
There isn’t a set time to selling your facility, either, as trends show the variables of the individual ALF and it’s terms of sale will ultimately set the pace for how long it will take to sell. In general, though, the larger the sale, the longer it will take and vice versa, mostly due to the complexity of the sale and in addition, the risk of purchasing a facility that large from the buyer. If you have a smaller ALF for sale in Florida, chances are the sale won’t take long to process, but if you have a billion dollar ALF for sale in California, that is going to take time, so remember to stay patient and optimistic.
Contact Us
If you’re feeling it’s time to sell your ALF but are a little overwhelmed with all the factors, or know that your facility is large and going to entail a lot of money, you shouldn’t have to handle all of that on your own! ALF For Sale in Florida can help you from start to finish with the sale of your facility, all with a seamless and successful transition. Our licensed real estate agents are waiting to assist you so give us a call today!