ALF Conversion
Madison Heights, MI (Oakland County). Buy-side mandate for Sponsor Nathan Zaher (Emanay Ventures Associate) — Emanay Advisors is running diligence, capital structuring, and transaction coordination through close.
Convert an existing 154-bed former SNF into an assisted living / Home for the Aged operation using the existing resident-room layout, private bathrooms, elevators, generator, and senior-care physical plant — a head start versus ground-up development.
Conservative: 28% NOI margin, 10% cap → $12.1M value ($8.3M spread). Sponsor-target: 44.2% NOI margin, 8.5% cap → $22.5M value ($17.7M spread). Same $4.32M base revenue — the gap is entirely expense assumptions. See Revenue & Operating Model.
Open items: seller identity, sponsor acquisition entity, sponsor track record, and full capital stack (equity/debt split, minimum investment, target return, fees) are not yet confirmed. The sponsor-target expense budget also has several unvalidated placeholder line items (utilities, insurance, property tax, food cost). See the Data Room for the full list.
Senior Care.
A purpose-built senior-care asset with existing room/bath infrastructure — the renovation plan is a targeted modernization, not a ground-up build.
154 beds / 80 rooms
2.01 acres / 72 parking
40,159 SF · Built 1970
The 160-bed question: every revenue figure on this portal is a function of licensed capacity, and that capacity is not approved. The building was previously licensed for 154 skilled-nursing beds — the operating plan targets 160 beds under Michigan's Home for the Aged framework. That is not a return to prior capacity; it's six beds above it, under a different license type, in a building constructed in 1970. Prior SNF licensure at 154 does not imply HFA licensure at 160.
| Licensed Capacity Scenario | Annual Gross Revenue (90% Occ.) |
|---|---|
| 160 beds — target | $4.32M |
| 154 beds — restore prior SNF capacity | $4.16M |
| 120 beds | $3.24M |
| 80 beds — single occupancy (1/room) | $2.16M |
- Private bathroom in each resident room
- 2 hydraulic passenger elevators (modernized 2017)
- 130-kW natural-gas emergency generator
- Individual packaged HVAC in resident rooms; RTUs in common areas
- 120/240-volt, 2000A three-phase power
- TPO roof replaced 2016 (warranty through 2036)
- Resident rooms — cosmetic refresh, flooring, accessibility upgrades
- Common areas — dining, lounges, activity spaces, salon/wellness
- Life safety — fire alarm/sprinkler, egress, nurse-call systems
- Back of house — kitchen, laundry, staff areas, IT/security
- Optional memory-care wing — secure access, wandering prevention
- Budget target: $1.0–1.5M, pending architectural/licensing review
Location: Madison Heights / Oakland County — minutes from I-75 and I-696, Dequindre Road exposure at 32,000+ vehicles/day (JLL), dense Detroit-metro infill with an existing senior-living ecosystem nearby (StoryPoint / Independence Village).
Same Revenue Line.
Both cases share the same revenue model ($2,500/bed/mo., 90% base occupancy = 144 beds = $4.32M annual gross). They diverge entirely on the expense side. This is a repositioning, not an in-place cash-flowing acquisition — neither case is historical.
| Occupancy Scenario | Occupied Beds | Annual Gross Revenue |
|---|---|---|
| 85% | 136 | $4.08M |
| 90% — Base Occupancy | 144 | $4.32M |
| 95% | 152 | $4.56M |
| 100% | 160 | $4.80M |
- Gross resident revenue: $4.32M
- Operating expenses (illustrative, 72% of revenue): ($3.11M)
- Illustrative NOI: $1.21M
- NOI margin: 28%
- Gross resident revenue: $4.32M
- Operating expenses (line-item budget, 55.8% of revenue): ($2.41M)
- Stabilized NOI: $1.91M
- NOI margin: 44.2%
Why the gap: NIC MAP reports average senior-housing operating margins above 25% (mid-2025) and assisted-living occupancy of 87.7% (YE 2025). The 44.2% sponsor-target margin is a lean, line-item staffing/expense budget — several inputs (utilities, insurance, property tax, food cost) are explicitly labeled placeholders pending real quotes and historical data, per the sponsor's own underwriting disclaimer.
- Direct-care/medication staff: $820K (19.0% of rev.) — must be validated against resident acuity/licensing
- Food/dietary supplies: $150K (3.5%) — ~$2.85/resident-day, aggressive, requires validation
- Utilities: $90K (2.1%) — placeholder pending historical data
- Property & liability insurance: $85K (2.0%) — placeholder pending quote
- Property taxes: $90K (2.1%) — placeholder pending post-closing analysis
- Management fee: $129.6K (3.0% of base revenue)
Stand Today.
A single, locked-in target under contract — not an open search.
Two Very Different Spreads.
Same $3.5–4.0M (low) to $4.2–5.35M (high) capitalization range. Exit value diverges heavily depending on which NOI/cap-rate case is used.
$11.0M
90% occ. / $1.21M NOI
$12.1M
$8.3M spread vs. $3.75M midpoint basis
$13.4M
Class A comparable range
$20.0M
$1.70M NOI / 41.8% margin
$22.5M
$1.91M NOI / 44.2% margin
$27.3M
$2.32M NOI / 48.4% margin
The gap between cases is almost entirely expense assumptions, not revenue. Both cases use the same $4.32M base-case revenue at 90% occupancy. Conservative case: 72% expense ratio (28% margin) → $12.1M value @ 10% cap. Sponsor-target case: 55.8% expense ratio (44.2% margin) → $22.5M value @ 8.5% cap. The ~$10M swing in implied value is driven by whether the lean, partially-unvalidated expense budget can actually be executed.
Sensitivity matters: capacity approval, achievable pricing, staffing cost, and occupancy are the primary drivers in both cases. Illustrative only — excludes working capital, financing, FF&E outside renovation scope, reserves, selling costs, debt payoff, taxes, and investor distributions.
Mitigants.
The Data Room.
Access to full documents requires an executed NDA. Contact Alexandre Camus for anything marked available below.
Behind The Deal.
Checklist.
Shared across the team — check items off as they're resolved. Persists for everyone with team access.
Notes.
Freeform working notes on equity/debt split, minimum investment, target return, fees, and term — not yet finalized with the Sponsor. Shared across the team.
Disclaimer.
This portal has been prepared by Emanay Advisors on behalf of Sponsor Nathan Zaher (Emanay Ventures Associate) in connection with the proposed buy-side acquisition of 31155 Dequindre Road, Madison Heights, Michigan. Access is provided solely to parties who have executed a Non-Disclosure Agreement and is intended exclusively for evaluating a potential co-investment or debt financing in this acquisition. Any retransmission, reproduction, distribution, or other use without prior written consent of Emanay Advisors is strictly prohibited.
All financial information is sourced from the sponsor's investor materials and has not been independently audited or verified. Two underwriting cases are presented (conservative and sponsor-target) — neither constitutes historical property performance, an appraisal, or a guarantee of future results. No representation or warranty, expressed or implied, is made as to accuracy or completeness. This portal is not an offer to sell securities or assets.
The Sponsor reserves the right to negotiate with one or more capital partners at any time, modify the proposed structure without notice, and terminate any party's participation for any reason. No contact with the seller, JLL brokerage team, or Michigan licensing authorities without Emanay's prior written authorization.
Emanay Inc., operating under the trade name Emanay Advisors, does not offer, solicit, or sell securities. All professional services are rendered exclusively by its respective affiliate divisions: Emanay Accounting, LLC; Emanay Law Group PLLC; Emanay Realty LLC; Emanay Technologies LLC; Emanay Ventures LLC; Emanay Capital LLC. Nothing contained herein constitutes legal, tax, financial, or investment advice.
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