Oak Park Manor
Alzheimer's & Dementia Care Property
501 S. College Avenue, Claremont, CA 91711 USA
- Preferred dividend of 7%* per annum for the first 5 years, to be distributed semi-annually
- Target Return of capital in year 4
- Investment time frame of 5-7 years
- Target average return of 20%+ per annum
Located approximately 24 miles east of Pasadena and 30 miles east of downtown Los Angeles at the base of the San Gabriel Mountains, CLAREMONT is best known for its tree-lined streets, historic buildings, and seven higher-education colleges' campuses.
The city has a total area of 13.4 square miles and a population of 34,926 and 16.5% are 65 years of age or older. In 2007, it was rated by CNN/Money magazine as the fifth best place to lia, it is known as "the City of Trees and PhDs". Source: 2010 United States Census
Oak Park Manor in Claremont, CA established in 1996, is a privately owned assisted living facility offering Alzheimer's care
About the Property
- 1.2 acres
- A secured environment in a recently redecorated home-like setting
- 54 beds in private and semi-private rooms
- Private pay, costs from US$3,300-4,500 per month
- Provides assistance with daily living activities
- Medication management
- Secured areas to allow wandering, a common symptom of the Alzheimer's disease
Seller and Operations Company
The administrator of Oak Park Manor is a licensed nurse and has been employed since the property was purchased in 1996. Occupancy averages 100%. There is a waiting list because of its full occupancy. The company will be adding up to 14 additional beds in this facility over the next 2-3 years.
Investment Strategy
- An acquisition loan of 55% of value for 5 years from SunWest Bank with a fixed interest rate of 6.5% and a 25 year amortization will be obtained.
- The seller – New Vista Health Services Inc. will continue to manage the facility under a master lease of 5 years.
- A preferred* income is offered to investors in the first 5 years.
- When extra beds are added, additional cash flow will be generated and paid to the investors.
- New Vista will continue to manage the property after five years for a management fee of 5% of the income and the cash flow after expenses will be paid to the property without a lease guarantee.
Expected Returns
Investors with investment amount of US$100,000 or over will receive a preferred return of 7%* per annum for the first 5 years. Profit above 7% will also be paid out.
After the property is refinanced in the 4th year, 80%-100% (estimated) of the capital could be returned. After year 5, investors can vote for receiving the refinancing proceeds or continuing to receive an increased cash flow. Dividends will continue to be distributed, and the dividend rate will depend on the financing rates and the % of the capital returned to the investors.
The property is expected to be sold at year 5 to 7. Any shortfall of return on capital will be paid to investors plus 70% of any appreciation in value. When the property is sold, the Program Manager will receive 30% as performance fee of any appreciation in value after the investors receive all their capital and the 7% preferred return.
* 7% per annum return for the first 5 years are guaranteed by the seller – New Vista Health Services Inc. under a master lease.
Only applicable for investment amount equals to US$100,000 or above.
For enquiries, please write to:
info@grandtagmadison.com
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