SAN DIEGO: There are myriad reasons why some finance institutions walk away from potential relationships in the senior housing sector. Here are the most often quoted excuses:
2. You’re not invested enough: The group ultimately responsible for the performance of the asset is the operator, and if the operator is working under a management agreement without an equity role it can deter investors.
In addition, a plan with unrealistic or overly optimistic assumptions will cause lenders to pause.
“An operator with industry experience and specific market experience should be able to benchmark the revenues and expenses based on the property’s market position relative to its competition.”