Market Feasibility Studies...
Creating senior housing market feasibility studies for senior housing
development financing is the core mission of Rainmaker Underwriting. Rainmaker
Underwriting has completed over
400 senior housing
market feasibility studies over the past 20 years, alone. Senior housing
market feasibility studies are (historically) Rainmaker Underwriting's
keystone service. We provide detailed analysis reports for assisted living
projects, independent living projects, entry-fee housing projects, congregate
living projects and continuing care retirement communities ("CCRCs" -
entry-fee and rental communities).
At its core, the
market feasibility analysis answers the following critical path issues
pertaining to every commercial real estate development program:
Is there sufficient entrenched demand within the
primary marketing area of the proposed project to support new construction?
If there is sufficient entrenched demand, what price
points will be supporting the new facility in terms of routine rental
revenues and ancillary revenues?
If there is
sufficient demand and price support, what
are the expectations regarding services, project amenities and facility
What has been the historical utilization of these
projects? How fast have new projects leased up in the recent history
of the market?
features and benefits should the project provide in order to be competitive
within its given sub-market competitive set?
The production of these feasibility reports generally
corresponds to the following steps:
Demand Analysis. Rainmaker Underwriting completes an initial demand analysis based upon
demographic information from third-party data vendors. This gives the
client the key "go-no-go" reality check for their project.
If the initial demand analysis report statistics do not demonstrate
sufficient demand to support the project at this stage, then the rest of the
reporting program is immediately abandoned. The reason for this is
that everything in our world is predicated upon demonstrable demand.
If there is sufficient demand, then the next phase is undertaken.
Investigation. Rainmaker Underwriting completes a survey of existing directly competitive
projects to determine price points, occupancy rates, staffing patterns, unit
class counts, unit class sizes, total unit counts per class and operating
costs. The result of this information is then used to modify the
Initial Demand Analysis.
Demand Analysis. Rainmaker Underwriting modifies the Initial Demand Analysis model to
reflect the findings of the Field Investigation.
Rainmaker Underwriting completes the final report. This is a full-color document (click
here to download a sample) that is
professionally formatted with all key data points and findings discussed on
an in-depth basis with conclusions being fully supported. This presentation includes recommendations on unit
mix, unit sizes, unit pricing, revenues, amenities, basic services,
additional services and all of the conclusions are tested with a complete pro forma
financial presentation and the goals, requirements and objectives of the
client's business model, owner's program and project - each in terms of the
other. This is the only way to logically create a working project
model for capital financing that provides the highest possible degree of
certainty our expertise can create for sizing your investment and maximizing
your opportunity for a successful outcome to the underwriting/investment due
diligence review, and still be focused on creating an ultimate transaction
structure to achieve the highest possible net present value for the client's
offers a complete array of customized consulting solutions to support all of
your due diligence and capital finance needs. If you are going to be
seeking third-party financing for your project, then you should have a
discussion with our one of our consultants on the matter as we offer the kinds
of support services specifically designed for your need that are provided by
consultants with actual successful development, finance, construction, marketing
and operating experience of their own. Talk to us and learn what
our expertise and tools can mean for your project.
do projects fail to get funding approved?
Rainmaker has had extensive
discussions through the years with clients who are seeking funding for
their commercial income-producing property development and construction
program, but have, so far failed to do so. Rainmaker has also had
extensive discussions with intermediaries, investment bankers, lenders,
investors and underwriters to get their side of the story. The
interesting thing is that the same five (5) things seem to come up again
and again that end up leading to a total failure. Are you destined
to fail? Can you afford to take the risk of blowing out even a
single funding source, knowing that source could be the one source you
needed to succeed? What can you do to avoid these terrible
mistakes that always lead to a rejection? Click
here and learn more.