Senior Living Acquisition Model - Real Estate Pro Forma

This detailed and user-friendly Excel spreadsheet template provides a comprehensive and dynamic real estate financial model (Pro-forma) tailored for Senior Living centers' acquisition, renovation, and operation. The model evaluates the investment viability based on cash flow projections, including renovation budgets, operational performance, working capital requirements, and potential refinancing opportunities.

Model Features:

Dynamic Cash Flow Analysis: With detailed monthly and annual projections, this model computes essential investment metrics to gauge the property's acquisition feasibility, operational performance, renovation impacts, and potential resale value.

Acquisition-Phase Budgeting: The model allows for the integration of a renovation budget, enabling users to forecast and allocate funds for property improvements.

 

Debt Options:

The model is designed with three customizable debt financing options to suit various acquisition and renovation strategies:

– Acquisition Loan: The primary loan used for the initial purchase of the Senior Living Center.

– Mezzanine Loan: A subordinate loan acting as a gap bridge for funding unit renovations, providing the necessary capital to improve the property without requiring immediate equity outlay.

– Refinance of Acquisition Loan: Offers the potential to restructure the acquisition loan after a set period, potentially securing more favorable terms based on the property's performance.

Capital Stack Framework:

– Sequential Funding Strategy: Funding draws occur in a tiered approach—equity first, followed by mezzanine debt (if any), and finally, the acquisition loan, aligning with industry-standard financing structures.

– Mezzanine Loan/Bridge Loan: Dedicated to filling funding gaps for renovations, with flexible interest payment options linked to operational cash flow and provisions for capitalization of unpaid interest.

– Loan Refinancing Dynamics: The model includes options for refinancing the acquisition loan;

Working Capital Funding: The model also allows users to set and fund a working capital reserve at the acquisition, ensuring the property has adequate liquidity to cover operational needs immediately after the acquisition.

Equity Waterfall Analysis:

The waterfall distribution function offers users the flexibility to select between two to four tiers for allocating capital among limited and general partners, enhancing clarity in articulating investment returns and equitable distribution of partnership equity stakes.

Instructions:

– Input information only into the cells formatted with the dark blue font on the 'Investment Summary' and 'Assumptions' sheets. Cells containing black text indicate the presence of a formula.

– This template includes data from a hypothetical Senior Living property for demonstration purposes, which should be removed when evaluating an actual property.

– The 'Investment Summary' sheet offers a snapshot of the property, incorporating various essential metrics and assumptions.

– Establish additional parameters within the 'Assumptions' sheet.

– The model capitalizes the Net Operating Income (NOI) of the 12 months after those of the disposition, dividing it by the stipulated exit cap rate to deduce the sale value.

– This model's maximum time frame is ten (10) years.

– For the 'Renovation Budget,' allocate funds across various categories listed in the 'Assumptions' sheet, ensuring a comprehensive plan for property improvements.

– Set the required working capital needs in the 'Assumptions' sheet to ensure adequate liquidity at acquisition, providing the necessary financial cushion for post-sale operations.