Green Life Assisted Living - LoopNet€¦ · Green Life Assisted Living 840 SW 8th St Pompano...

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Green Life Assisted Living840 SW 8th St | Pompano Beach, FL 33060

JOHN DEMARCO, [email protected]

Turn-Key fully licensed and operating 71 bed Assisted Living Facility➢

Easy to manage and operate, full staff will stay on➢

Great South Florida location, one of the best Aging demographics in the Country➢

Current operator can do a lease back➢

Only $63,239 per bed, 8.99% actual cap rate, 11.83% pro-forma cap rate➢

RE/MAX 5 STAR REALTY4151 Hollywood BlvdHollywood, FL 33020(954) 361-0000www.DeMarcoGroup.com

INVESTMENT DETAILS840 SW 8th St | Pompano Beach, FL 33060

The accuracy of all information, regardless of source, including but not limited to square footages and lot sizes, is deemed reliable but not guaranteedand should be personally verified through personal inspection by and/or with the appropriate professionals.

Analysis

Analysis Date November 2017

Property

Property Green Life Assisted Living

Property Address 840 SW 8th StPompano Beach, FL 33060

Year Built 1976

Financial Information

All Cash

Purchase Information

Property Type Health Care

Purchase Price $4,490,000

Tenants 71

Total Rentable Sq. Ft. 11,022

Loans

Type Debt Term Amortization Rate Payment LO Costs

All Cash

Income & Expenses

Gross Operating Income $1,181,616

Monthly GOI $98,468

Total Annual Expenses ($778,095)

Monthly Expenses ($64,841)

Contact Information

John DeMarco, ACP

954-678-8733

[email protected]

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EXECUTIVE SUMMARY840 SW 8th St | Pompano Beach, FL 33060


Acquisition Costs

Purchase Price, Points and Closing Costs $4,490,000

Investment - Cash $0

Investment Information

Purchase Price $4,490,000

Price per Tenant $63,239

Price per Sq. Ft. $407.37

Income, Expenses & Cash Flow

Gross Scheduled Income $1,181,616

Total Vacancy and Credits $0

Operating Expenses ($778,095)

Net Operating Income $403,521

Debt Service $0

Cash Flow Before Taxes $403,521

Financial Indicators

Debt Coverage Ratio N/A

Capitalization Rate 8.99%

Gross Income / Square Feet $107.21

Gross Expenses / Square Feet ($70.59)

Operating Expense Ratio 65.85%

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PROPERTY DESCRIPTION840 SW 8th St | Pompano Beach, FL 33060


John DeMarco with Re/Max 5 Star Realty is please to present Green Life Assisted Living Facility. Green Life is afully licensed and operating 71 bed assisted living facility located in Pompano Beach Florida. This ALF is in great overallcondition. Predominately a Medicaid facility, it is easy to lease and operate.

Green life currently has 63 residents out of 71 Beds. It is grossing $1,181,616 per year, netting $403,521 per year.Full management and well trained staff will stay on board making this a true turn key and passive investment. Theactual NOI provides an investor with 8.99% capitalization rate. When fully leased up, the NOI is on track to increase to$530,791, this would give an investor a 11.83% capitalization rate. Enclosed in offering is a very accurate Pro-formashowing significant upside to increase NOI and the overall value of this property.

If desired by investor the current operator / owner will lease back the property after closing providing a buyer with7% -8% capitalization rate based on a long term lease.

Green Life is being sold well below recent comparable sales. Similar ALF's in South Florida ave sold as high as$125,000 per bed, this facility is trading at only $63,239 per bed at full asking price. South Florida is considered to havethe third best aging demographics in the entire United States. This is an excellent investment opportunity to purchase aturn key ALF in South Florida.

Possible seller financing available.

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PROPERTY PHOTOS840 SW 8th St | Pompano Beach, FL 33060


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SALE COMPARABLES840 SW 8th St | Pompano Beach, FL 33060


S Green Life Assisted Living840 SW 8th StPompano Beach, FL 33060

Sale Price $4,490,000

Tenants 71

Price/Tenant $63,239

Price/SqFt $407.37

Cap Rate 8.99%

Year Built 1976

NOTES$73,239 per Bed

1 Azalea Gardens1701 Mayo StHollywood, FL 33020


Tenants 35


Price/SqFt $454.60

Cap Rate N/A

Year Built N/ASale Date 3/13/2016


2 Fountains ALF3800 N Federal HwyBoca Raton, FL 33431


Tenants 46


Price/SqFt $298.83

Cap Rate 7.1%

Year Built 1965Sale Date 11/11/2015


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SALE COMPARABLES840 SW 8th St | Pompano Beach, FL 33060


3 Benton House

Melbourne, FL


Tenants 65


Price/SqFt $316.89

Cap Rate N/A



4 Delaney Creek Lodge

Fort Mayers, FL


Tenants 86


Price/SqFt $275.39

Cap Rate N/A



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RENT ROLL840 SW 8th St | Pompano Beach, FL 33060


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PRO-FORMA PNL840 SW 8th St | Pompano Beach, FL 33060

The accuracy of all information, regardless of source, including but not limited to square footages and lot sizes, is deemed reliable but not guaranteed and should be personally verified through personal inspection byand/or with the appropriate professionals.

PRO-FORMAPROFIT&LOSS Budget-PompanoBeachBusinessName: GreenLifeAssistedLivingFacility,LLC2017

ResidentsMC18Bed 6 11 18 17 18 17 18Residents(71maxtotal) 62 65 63 64 66 61 56 51 53 53 53 53

JAN FEB MARCH APRIL MAY JUNE JULY AUGUST SEPT OCT NOV DEC YR.ENDTOTALRevenue 83700 87750 85050 86400 89100 82350 75600 68850 71550 71550 71550 71550 945,000.00$ MemoryCareUnit 0 0 0 0 0 15900 29150 47700 45050 47700 45050 47700 278,250.00$ TOTAL 83700 87750 85050 86400 89100 98250 104750 116550 116600 119250 116600 119250 1,223,250.00$

Reimbursements-Toresidents 1550 1625 1575 1600 1650 1675 1675 1725 1750 1775 1750 1775 20,125.00$Food&Supplies 8370 8775 8505 8640 8910 9045 9045 9315 9450 9585 9450 9585 108,675.00$ ManagementFee 0 0 0 0 0 0 0 0 0 0 0 0 -$EmployeeSalary/Wages 17577 18427.5 17860.5 18144 18711 20632.5 21997.5 24475.5 24486 25042.5 24486 25042.5 256,882.50$ PayrollTaxes 7114.5 7458.75 7229.25 7344 7573.5 8351.25 8903.75 9906.75 9911 10136.25 9911 10136.25 103,976.25$

ProfessionalFees 500 500 500 500 500 500 500 500 500 500 500 500 6,000.00$Legal 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 12,000.00$Utilities&Telephone 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 42,000.00$Liab/Bus/BldgInsurance 2800 2800 2800 2800 2800 2800 2800 2800 2800 2800 2800 2800 33,600.00$RealEstateTaxes 2100 2100 2100 2100 2100 2100 2100 2100 2100 2100 2100 2100 25,200.00$Amort/InterestExpense* 0 0 0 0 0 0 0 0 0 0 0 0 -$MaintenanceExpense 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 2500 30,000.00$Auto/Travel/Phone 500 500 500 500 500 500 500 500 500 500 500 500 6,000.00$SalesandMarketing* 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 4000 48,000.00$TotalExpenses 51511.5 53186.25 52069.75 52628 53744.5 56603.75 58521.25 62322.25 62497 63438.75 62497 63438.75 692,458.75$

EBITA 32188.5 34563.75 32980.25 33772 35355.5 41646.25 46228.75 54227.75 54103 55811.25 54103 55811.25 530,791.25$

0 0 0 0 0 0 0 0 0 0 0 0 -$

530,791.25$

Amort/Mortgage* 0 0 0 0 0 0 0 0 0 0 0 0 -$

CashFlow 32188.5 34563.75 32980.25 33772 35355.5 41646.25 46228.75 54227.75 54103 55811.25 54103 55811.25 530,791.25$

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MAPS AND AERIALS840 SW 8th St | Pompano Beach, FL 33060

The accuracy of all information, regardless of source, including but not limited to square footages and lot sizes, is deemed reliable but not guaranteed and should be personally verified through personal inspection byand/or with the appropriate professionals.

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DEMOGRAPHICS840 SW 8th St | Pompano Beach, FL 33060


Population 1 Mile 3 Mile 5 Mile

Male 7,149 (49.40 %) 51,083 (48.71 %) 140,597 (49.69 %)

Female 7,322 (50.60 %) 53,784 (51.29 %) 142,345 (50.31 %)

Total Population 14,471 104,867 282,942

Age Breakdown 1 Mile 3 Mile 5 Mile

Ages 0-4 690 (4.77 %) 4,514 (4.30 %) 12,428 (4.39 %)

Ages 5-9 860 (5.94 %) 5,775 (5.51 %) 15,844 (5.60 %)

Ages 10-14 819 (5.66 %) 5,452 (5.20 %) 14,927 (5.60 %)

Ages 15-19 780 (5.39 %) 5,297 (5.05 %) 14,363 (5.08 %)

Ages 20-24 750 (5.18 %) 5,294 (5.05 %) 14,408 (5.09 %)

Ages 25-29 771 (5.33 %) 5,321 (5.07 %) 14,534 (5.14 %)

Ages 30-34 854 (5.90 %) 5,562 (5.30 %) 15,303 (5.41 %)

Ages 35-39 992 (6.86 %) 6,085 (5.80 %) 16,742 (5.92 %)

Ages 40-44 1,087 (7.51 %) 6,901 (6.58 %) 18,932 (6.69 %)

Ages 45-49 1,111 (7.68 %) 7,633 (7.28 %) 21,049 (7.44 %)

Ages 50-54 1,064 (7.35 %) 7,739 (7.38 %) 21,202 (7.49 %)

Ages 55-59 966 (6.68 %) 7,409 (7.07 %) 20,121 (7.11 %)

Ages 60-64 831 (5.74 %) 6,725 (6.41 %) 17,883 (6.32 %)

Ages 65-69 657 (4.54 %) 5,818 (5.55 %) 15,195 (5.37 %)

Ages 70-74 506 (3.50 %) 4,952 (4.72 %) 12,706 (4.49 %)

Ages 75-79 387 (2.67 %) 4,127 (3.94 %) 10,510 (3.71 %)

Ages 80-84 331 (2.29 %) 3,354 (3.20 %) 8,549 (3.02 %)

Ages 85+ 1,015 (7.01 %) 6,909 (6.59 %) 18,246 (6.45 %)

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DEMOGRAPHICS840 SW 8th St | Pompano Beach, FL 33060


Household Income 1 Mile 3 Mile 5 Mile

Median Income $35,462 $49,248 $49,483

Less than $10,000 623 3,804 9,938

$10,000 -$14,999 411 2,795 6,661

$15,000 - $19,999 377 2,710 7,352

$20,000 -$24,999 472 3,299 7,717

$25,000 - $29,999 485 3,031 7,870

$30,000 - $34,999 362 2,445 7,519

$35,000 - $39,999 338 2,264 6,463

$40,000 - $44,999 335 2,644 6,800

$45,000 - $49,999 287 2,209 6,000

$50,000 - $59,999 388 3,320 9,741

$60,000 - $74,999 622 5,361 13,217

$75,000 - $99,999 770 4,918 12,955

$100,000 - $124,999 152 2,640 7,046

$125,000 - $149,999 200 2,006 4,185

$150,000 - $199,999 172 1,701 4,290

Greater than $200,000 100 1,616 4,727

Housing 1 Mile 3 Mile 5 Mile

Housing Units 7,707 62,249 160,411

Occupied Units 6,249 48,552 127,752

Owner Occupied Units 2,982 28,981 79,822

Renter Occupied Units 3,267 19,571 47,930

Vacant Units 1,458 13,697 32,659

Race Demographics 1 Mile 3 Mile 5 Mile

Population Non Hispanic White 9,692 73,453 185,984

Population Black 3,326 24,794 76,720

Population Am In/Ak Nat 18 31 127

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LOCATION MAP840 SW 8th St | Pompano Beach, FL 33060


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ALF STUDY840 SW 8th St | Pompano Beach, FL 33060


Senior Living Industry Overview

INDEPENDENT LIVING

Congregate care or independent living units are designed for seniors who pay for

some congregate services (i.e. housekeeping, transportation, meals, etc.) as part

of the monthly fee or rental rate, and who require little, if any, assistance with

activities of daily living. Residents of congregate/independent living units may

also receive some health care services provided by in-house staff or an outside

agency. Congregate units may be part of an “age in place” residence, a property

that provides assisted living services, or a continuing care retirement community.

The retirement housing industry has matured considerably over the past three

decades as the elderly population increased and more senior housing

alternatives are sought. Retirement housing expanded beyond the early

dominance of life care and continuing care retirement communities (CCRCs).

These communities, which typically included independent living and nursing care

on a single campus, typically charge residents a high entrance fee and a

moderate monthly service fee. Rental retirement communities represented a

major area of growth in the 1980s.

Today’s retirement community is generally a smaller complex consisting of 100 to

200 independent living units as compared to the 200 to 300 independent living

units that characterized the early CCRCs. In some cases, communities are

developed in stages to avoid some of the up front risk associated with initial

lease-up, and to allow the facility to be more responsive to market needs and

preferences.

The rental retirement communities of the early 1980s typically offered no nursing

care or assistance with daily living. Rather, these facilities were designed to

provide hospitality services such as meals, housekeeping, transportation, and

recreational activities. These facilities met with slow lease-up rates and

exceedingly high turnover due to their inability to meet changing needs of

residents.

Independent living communities, particularly rental communities, are the least

heavily monitored and the least governed by state regulations of all senior

housing communities. In some states, this has resulted in a fair degree of

flexibility in providing additional services.

Over the last decade, retirement communities have been attracting an older and

somewhat frailer population than originally anticipated. The average age of

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entrance into an independent living facility is between the late 70’s and early

80’s, rather than the late 60’s and early 70’s as originally anticipated. As a result

of the change in resident profile, as well as the experience gained in the 1980s, it

is clear that some form of health care or supportive services for the frail elderly is

a necessary component of a retirement community.

The recession and slowdown of the housing market has impacted the

independent living and CCRC segment of senior housing more significantly than

assisted living and skilled nursing. These prospective residents have the most

flexibility in delaying entry and/or choosing a lower priced active adult complex

instead of a full amenity independent living or CCRC facility. Construction starts

have dropped considerably since 2008, which should help the industry slowly

absorb excess inventory in some markets. Facilities have also responded to

lowered occupancy levels by seeking more ways of keeping residents as acuity

levels rise, as well as offering move-in promotions to lease vacant units.

ASSISTED LIVING

The emergence of assisted living in the 1990s as an option in the long-term care

continuum for elders represented the convergence of social, political, economic

and treatment trends. Prior to this time, most dependent seniors had only two

long-term care options: be cared for by a family member or enter an

institutionalized nursing home. Today, these limited options are inadequate to

serve the diverse needs of the elderly population. For many elderly, individual

nursing homes are overly intensive, expensive and institutional. In response,

assisted living is a favored form of long-term care for those seniors with

moderate to intermediate care needs.

The Assisted Living Federation of America defines assisted living as a long-term

care option that combines housing, support services and health care, as needed.

Assisted living is designed for individuals who require assistance with everyday

activities such as meals, medication management or assistance, bathing,

dressing and transportation. Some residents may have memory disorders

including Alzheimer's, or they may need help with mobility, incontinence or other

challenges. Residents are assessed upon move in, or any time there is a change

in condition. The assessment is used to develop an Individualized Service Plan.

Although the general characteristics and philosophy behind assisted living are

consistent throughout the country, there is no consensus on a legal definition of

this term. Some states enacted laws using the term assisted living; however, in

most jurisdictions, licensure statutes contain a variety of programs and services.

In referring to residential housing and services, most state licensing laws use

terms such as: adult homes, personal care homes, homes for the aged,

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supportive living facilities, residential care facilities, board and care homes,

elderly group homes, congregate care housing and senior housing.

Typically, a resident will have a compact studio or efficiency apartment with a

private bathroom. The living space may or may not include a kitchenette (sink

and small refrigerator), a living room or storage space. Economics generally

dictate the size of the private living space, which can range from a small one-

room efficiency of less than 300 square feet to a large two-bedroom apartment of

750square feet or larger.

Assisted living residences also provide for a considerable amount of common

space for the residents. Newer assisted living facilities generally allocate

approximately 40 percent of the total gross square footage of the building to

common areas. Such space includes dining rooms, libraries, lounges, activity

centers, kitchens and laundry rooms. The size of an assisted living facility

depends on many variables, including market forces and site constraints. Most

new freestanding facilities typically provide 40 to 100units.

The level of service in assisted living facilities varies substantially. However,

there are certain basic services generally offered including:

24-hour a day on-site supervision or access to an emergency call system;

Two or three meals and regular snacks are available;Light housekeeping

and laundry services are available;Some level of daily personal care from

the facility staff;

A personalized health care plan delineating how a resident’s health care

needs may be addressed; and

Recreational activities, social services and transportation resources.

An objective of assisted living is to enable residents to age in-place. Thus, the

level of personal care, congregate services or health care services may be

adjusted upwards as needed. However, this may prove difficult if residents need

increasing amounts of nursing care since state law may limit or prohibit skilled

nursing care in assisted living facilities. Despite this issue, there is a growing

trend by states to extend the scope of assisted living services far into the long-

term care continuum.

According to the National Center for Assisted Living (NCAL), the average age of

residents in assisted living facilities in 2009 was 86.9 years. The typical resident

is a female who is single or widowed. Today’s assisted living residents have care

needs and characteristics previously associated with patients in intermediate

care nursing homes in the 1970s and 1980s. Senior care needs are gauged by

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the extent to which an individual requires regular assistance with ongoing

activities of daily living (ADLs) such as bathing, eating, walking, toileting and

dressing. In order to determine that there is an ADL dependency, a clinician must

determine that an individual cannot safely or routinely perform a specific activity

without assistance, and unless such help is provided, the individual is at risk of

not meeting an essential daily need.

The typical assisted living resident needs assistance with approximately two

ADLs. While the number of ADLs with which a person needs assistance is used

clinically as a measure of dependency, such dependency does not necessarily

mean that medical care is required. In assisted living facilities, residents

generally have at least one ADL dependency, and it is not uncommon that they

have as many as three or four.

ALZHEIMER’S

In a 2012 study by the Alzheimer’s Association (2012 Alzheimer’s Disease Facts

and Figures), Alzheimer’s disease is the most common cause of dementia

among people age 65 and older. Currently, an estimated 5.4 million Americans of

all ages have Alzheimer’s disease. This includes 5.2 million people who are aged

65 and older. The number of Americans with Alzheimer’s is increasing every year

because of the steady growth in the older population, and this number will

continue to increase and escalate rapidly in the coming years as the baby boom

generation ages.

The report further found:

One in eight persons aged 65+ have Alzheimer’s disease.

Of people aged 85+, 45 percent have Alzheimer’s disease.

In 2011, the first baby boomers turned 65. By 2029, all baby

boomers will be at least 65 years old.

By 2025, the number of people age 65 and older with

Alzheimer’s disease is estimated to reach 6.7 million — a 30 percent

increase from the 5.2 million age 65 and older currently affected.

In 2012, the 85-years-and-older population includes about 2.5

million people with Alzheimer’s disease, or 48 percent of the Alzheimer’s

population age 65 and older. When the first wave of baby boomers

reaches age 85 (in 2031), an estimated 3.5 million people age 85 and

older will have Alzheimer’s.

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Aggregate payments for health care, long-term care and hospice

for people with Alzheimer’s disease and other dementias are projected to

increase from $200 billion in 2012 to $1.1 trillion in 2050 (in 2012 dollars).

Medicare and Medicaid cover about 70 percent of the costs of care.

Average survival time was four to six years after diagnosis, but

survival can be as long as 20 years from first symptoms.

OCCUPANCY PATTERNS

Occupancy data compiled by the American Seniors Housing Association (ASHA),

and published in The State of Seniors Housing 2014, for the various senior

housing community types (congregate, assisted and CCRCs) has been

summarized in the following table.

After reaching a low point in 2010, Independent living communities have shown

positive gains each year, while Assisted Living performance has been more

erratic but up from their low points in 2012.

CCRCs were also impacted by the recession and slow housing market, as

prospective residents often delayed entry. However, 2013 performance shows an

increase and for the first time in four years a level close to breaking the 90

percent level.

In more recent data compiled by NIC MAP reviewing data through Q3 2014:

Independent Living occupancy has increased to 90.9 percent in

Q3 2014, an increase of 40 bps from the prior quarter and up 140 bps from

a year ago.

Assisted Living occupancy increased in Q3 2014 to average 89.4

percent, an increase of 50 bps from the prior quarter and up 50 bps from a

year ago.

Nursing home occupancy was 88.3 percent in Q3 2014,

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unchanged from the prior quarter and up 70 bps from a year ago.

CCRC occupancy was 90.1 percent in Q3 2014, up 30 bps from

the prior quarter and 110 bps from a year ago. Occupancy in entrance fee

CCRCs was up 20 bps, and rental CCRCs occupancy was up 50bps from

the prior quarter.

The average length of stay in a senior housing facility also varies with the facility

type. Following is a table that sets forth the average length of stay, based on data

compiled by ASHA and published in The State of Seniors Housing 2014.

The average length of stay decreased for most property types. Additionally, more

states are permitting assisted living facilities to manage higher acuity levels in an

effort to relieve pressure on nursing home expenditures, causing an overall

increase in length of stay within assisted living when compared to figures

reported a decade ago.

ABSORPTION TRENDS

Net absorption data compiled by ASHA for senior housing facilities is

summarized in the following table. We note that this is the most recent

information that has been published.

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As seen, initial absorption of new residents for all facility types is strong in the

first month, but then tapers off during the following months and second and third

years.

While the above published data is the most recent available, we acknowledge

that absorption rates in most regions have certainly been impacted by the

slowdown in the residential markets, as prospective residents choose to delay

entry, or are unable to move as they await the sale of their home. Marketing

professionals interviewed have indicated the sales-cycle has lengthened for both

independent living and assisted living prospective residents. While no timely

national average publications are available on this topic, the historical absorption

trends may not be applicable in many of today's markets.

NIC MAP’s Q3 2014 monitor report shows annual absorption continues to remain

positive as the number of occupied units increased by 4,879 in Q3 2014,

representing absorption of 1.0% during the quarter. Annual absorption as of Q3

2014 was at 2.9%, up 20 bps from the prior quarter’s pace.

The pace of inventory growth may be beginning to accelerate as this quarter

delivered the most units since the third quarter of 2009. In Q3 2014, inventory

increased by 2,650 units, representing an increase in inventory of 0.5% during

the quarter. Inventory increased by 1.7% during the past year, up 20 bps from

the prior quarter’s pace. In Q3 2014, there were 18,163 units remaining in the

construction pipeline, down 2% from the prior quarter and up 1% from a year

ago.

ACQUISITION MARKET

According to The Senior Care Acquisition Report, Nineteenth Edition, 2014,

published by Irving Levin Associates, after a slow two-year period in 2008 and

2009 with distressed sales predominating the market and lenders in hiding, the

seniors housing and care acquisition market turned the corner in the third quarter

of 2010 and continues to display positive growth.

While REITS dominated 2011 activity, 2012 saw a drop off in REIT activity as the

large deals have become increasingly expensive. In 2013, the dollar value of

publicly announced transaction increased by 14 percent to $163.5 billion, still far

short of 2011’s $231.0 billion.

Important factors impacting 2013 mergers and acquisitions include:

The health care economy continues to grow

IL/AL being bolstered by an improving economy and housing

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market, as well as the rising wealth of seniors population as the stock

market hit record highs in 2013

Occupancy across the sector has improved

On the skilled nursing side, the Affordable Care Act has had

some impact on acquisition activity as buyers line up strategic

acquisitions The report also indicated the average price per unit for IL/AL

communities in 2013 increased by 5% to $164,000 per unit, nearing the

record set in 2007. The report indicated the following average price points

for IL/AL properties:

The increase in average IL/AL price was due to the 38% increase in IL average

prices, which was influenced by a few portfolios with $200K+ and some $400K+

per unit sales. The assisted living units were down by 4.5%.

In terms of region, the report indicated the following 2013 performance:

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For the fourth consecutive year, the Northeast region had the highest average

price per unit at $185,000; however, this is down from the prior year’s $249,500

per unit.

Going forward, the fundamentals of senior housing will nonetheless result in an

increase in new development although the tightened credit markets will likely

inhibit any notable degree of construction over the short-term. With the industry

more knowledgeable and sophisticated today than during the overbuilding period

of the 1990s, the fundamentals of the market should provide for consistent long-

term growth in the industry.

FLORIDA ASSISTED LIVING ENVIRONMENT

Definition & Licensure

As reported by Florida Healthcare Association, by 2025, the proportion of

Florida's population older than 65 years of age is expected to be 26% of our

state's population (19% in 1995). This proportion is significantly greater than the

projected national rate of 19.6% in 2030 and poses both challenges and

opportunities for Florida's assisted living facilities. As assisted living facilities

position themselves to serve this increasing older population, external pressures

are forming which will influence regulatory policy and facility operations.

Florida’s elder services system is operated by three state agencies and

contracted public and private providers. The Department of Elder Affairs has the

primary state responsibility for services to elders. The department also

determines medical and functional eligibility for Medicaid nursing home

admissions and waiver programs through its Comprehensive Assessment and

Review for Long-Term Care Services (CARES) Program.

The Agency for Health Care Administration, as the state Medicaid agency, issues

certificates of need for nursing homes, regulates nursing homes and hospice

care, and operates five Medicaid long-term care waiver programs for seniors.

The Department of Children and Families determines financial and technical

eligibility for Medicaid-funded nursing home admissions, Medicaid waiver

programs, and public assistance programs, such as Medicaid, food stamps, and

cash assistance.

An “assisted living facility” is defined as any building or buildings, section or

distinct part of a building, private home, boarding home, home for the aged, or

other residential facility, whether operated for profit or not, which undertakes

through its ownership or management to provide housing, meals, and one or

P. 26



more personal services for a period exceeding 24 hours to one or more adults

who are not relatives of the owner or administrator.

Four licensure types are available: standard, limited nursing service, limited

mental health, and extended congregate care.

Standard: A facility licensed to provide housing, meals, and one or more personal

care services for a period exceeding 24 hours. Personal services include direct

physical assistance with or supervision of a resident’s activities of daily living

(ADL) and the self-administration of medication and similar services. The facility

may employ or contract with a person licensed under Chapter 464, F.S., to

administer medication and perform other tasks as specified in §400.4255, F.S.,

such as take vital signs, manage individual weekly pill organizers for residents

who self-administer medication, give prepackaged enemas ordered by the

physician, observe residents, and document in the resident’s record.

Limited nursing services (LNS): A facility licensed to provide a select number of

nursing services. Residents of facilities licensed to provide LNS services are

required to meet the standard ALF admission criteria. However, in addition to the

nursing services permitted in standard license, facilities holding a LNS license

may provide, directly or through contract, the following limited nursing services:

conducting passive range of motion exercises; applying ice caps or collars;

applying heat; cutting toenails of diabetic residents or residents with a

documented circulatory problem if the written approval of the resident’s health

care provider has been obtained; performing ear and eye irrigations; conducting

a urine dipstick test; replacing established self-maintained in-dwelling catheter or

performing intermittent urinary catheterizations; performing digital stool removal

therapies; applying and changing routine dressings that do not require packing or

irrigation, but are for abrasions, skin tears, and closed surgical wounds; caring for

Stage II pressure sores; caring for casts, braces, and splints; conducting nursing

assessments if conducted by, or under the direct supervision of, a registered

nurse; and for hospice patients, providing any nursing service permitted within

the scope of the nurse’s license, including 24-hour supervision.

Extended congregate care (ECC): A facility licensed to provide any of the

services under a standard license and LNS license, including any nursing service

permitted within the scope of the nurse’s license consistent with ALF residency

requirements and the facility’s written policy and procedures. A facility with this

type of license enables residents to age in place in a residential environment

despite mental or physical limitations that might otherwise disqualify them from

residency under a standard or LNS license.

Limited mental health license: An ALF that is licensed to serve three or more

mental health residents. A mental health resident is an individual who receives

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social security disability income or SSI income due to a mental disorder as

defined by the Social Security Administration and receives optional state

supplementation.

It is unlawful to own, operate, or maintain an assisted living facility without

obtaining/maintaining a current ALF license. Any person who owns, operates, or

maintains an unlicensed ALF commits a felony of the third degree. ALF licenses

are required to be posted in a common area.

Currently, there are approximately 2,830 facilities in the State of Florida.

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