Senior Living Facility Sees A Landmark Year With 57% Increase Of NOI

Increase Of NOI

Posted By: Pat Nelson / Feb 01 2011

Aliso Viejo, Calif. and New York, NY — Astounding investors and the real estate industry alike, Nelson Brothers Professional Real Estate, LLC, and Premier Senior Living, LLC, (New York) announced a 57% increase in net operating income for Eden Heights of Eden, New York, a 120- bed senior living facility. The property was first purchased for $6,987,000 with $2,087,000 in equity raised from 12 investors and a loan of $4,900,000 in 2009 with a projected NOI of $604,551 based on the investment’s private placement memorandum. According to Brian Nelson, Principal and co-founder for Nelson Brothers Professional Real Estate, the actual performance for 2010 produced an NOI of $949,483 including a 5% management fee which exceeded the original estimate by $344,932.

“We’re actually not that surprised,” said Nelson. “A 57% increase in net operating income in today’s economy is unparalleled, but that’s why we bought it, Premier saw the inefficiencies the previous owners were leaving on the table and they knew they could make an immediate impact. What’s even more impressive is that this wasn’t a high-risk, distressed or turnaround type project.

This was an older, stable, well-occupied property in a smaller farming community with impressive demographics.” He also added that with over 70% leverage on the property, the investors may also realize significant appreciations on top of the 8.25% distribution they are already receiving.

Both Brian and his brother, Patrick Nelson, also a principal and co-founder of the company credit much of this success to Premier’s business strategy and expertise in reducing costs, increasing revenue and driving up the bottom line that seemed to pay off substantially.

“We actually had investors from Southern California and other high-growth markets pass on this offering because they perceived a lack of upside and we agreed,” said Patrick. “We didn’t see a lot of upside coming from the local real estate market; we saw it from simple business fundamentals: cutting costs, increasing profit margins, improving customer service and growing revenue, that was all done in the underwriting and due diligence. Then Premier really capitalized”

Wayne Kaplan and Robert P. Borsody, owners of Premier Senior Living in the aggregate have between them over 37 years owning and operating assisted living facilities in New York State and throughout the country. The company offers more than 25 years of experience, operational sales, marketing and sophisticated management services based on knowledge of the financial and market pressures impacting each facility.

Premier Senior Living’s mission and philosophy is to champion the quality of life for every senior, providing a comfortable and dignified lifestyle that enhances each resident’s well being.

Nelson Bros. launched their real estate company in 2007 concentrating on the acquisition, financing and ownership of office, retail and multi-family properties for TIC investments throughout the West and Southwestern United States. The firm, owned by brothers Patrick and Brian Nelson is focused on the acquisition of real estate investments in the niche areas of student housing and assisted living investments.