Spanish Fork Assisted Living Portfolio, Four Utah Senior Care Communities

$2.4M

Revenue

$854K

SDE

12.9x

Multiple

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Full Editorial Writeup

This is a portfolio of four licensed assisted living communities operating in Spanish Fork, Utah, a fast-growing corridor south of Provo. The group runs 61 resident rooms across 73 licensed beds, with each facility carrying a Level II Assisted Living license plus secure memory care capabilities. That memory care designation matters because it commands higher reimbursement and creates stickier, longer-tenured residents who are far less likely to move once placed.

Demand here is fed by a mature referral network spanning hospitals, rehab centers, physicians, home health agencies, hospice providers, and family word of mouth. In senior care, referral relationships are the moat: discharge planners and physicians route patients to operators they trust, and those relationships compound over years. The residential-style format also differentiates this from institutional big-box facilities, appealing to families who want a homier setting.

At an $11m asking price against $853k of cash flow, the headline 12.89x multiple only makes sense because real estate is bundled into the deal. This is effectively a real estate plus operating business acquisition, and the buyer needs to separate the value of the four buildings from the going-concern operating value. On a stabilized, higher-occupancy basis with the RE properly financed, the economics can look very different from the surface multiple.

Why we like it

Cash flow of $853k on $2.36m revenue is a 36 percent margin, which is healthy for assisted living and reflects genuine pricing power from the Level II and memory care licensing. Memory care residents pay premium rates and stay longer, smoothing occupancy volatility that plagues lower-acuity operators. The earnings look real and operationally driven rather than one-time.
The moat is the referral network: hospitals, rehab facilities, physicians, home health, and hospice providers all feed this portfolio, and those relationships take years to build and are hard for a new entrant to replicate. Combined with state licensing caps on beds, this creates a durable local position. Reputation for quality care is the compounding asset here.
Senior care sits squarely in recession-proof demand. Families do not defer memory care or assisted living placement in a downturn because these are medical necessities, not discretionary choices, and the aging demographic tailwind in a growing Utah region only strengthens over the next decade. Occupancy is structurally supported by need, not sentiment.
A retiring seller with experienced staff and proven operating systems in place means the operational engine can transfer intact. For an operator who can install or retain a strong administrator, this is a business that runs on established playbooks rather than founder heroics. That lowers execution risk in year one.

How to improve it

Audit current occupancy against the 73 licensed beds and 61 rooms in the first 30 days. If occupancy is below 90 percent, filling even five to ten beds at premium memory care rates drops directly to the bottom line and can meaningfully re-rate the business given the fixed cost base.
Renegotiate or benchmark private-pay rates against comparable Utah facilities. Small residential-style communities often underprice memory care relative to market, and a 5 to 10 percent rate adjustment across a tenured resident base flows almost entirely to cash flow with minimal churn risk.
Formalize and expand the referral pipeline with a dedicated community liaison or admissions coordinator. Systematizing outreach to discharge planners, hospice, and home health agencies converts informal relationships into a repeatable admissions machine and shortens vacancy windows between residents.
Review staffing ratios and labor cost as a percentage of revenue. Assisted living lives and dies on labor efficiency, so scheduling optimization, reducing agency staffing reliance, and improving retention among caregivers can protect the 36 percent margin against wage inflation.
Explore consolidating back-office functions across the four communities. Shared administration, purchasing, billing, and compliance across a small portfolio captures scale economies that single-facility operators cannot, improving margin without touching resident care quality.
Evaluate the highest-and-best use of the licensed bed capacity. If any rooms are configured as doubles running as singles, or if a unit mix shift toward memory care is possible under the existing license, that repositioning can lift revenue per available bed.

Diligence notes

Separate the real estate value from the operating value immediately. At 12.89x cash flow the multiple only pencils because four buildings are included, so get independent appraisals on the properties and back into the true operating multiple to know what you are actually paying for the business versus the dirt.
Verify current census and occupancy by facility, plus the payer mix between private pay, Medicaid waiver, and any managed care. Occupancy trends over the trailing 24 months and average length of stay are the single most important indicators of cash flow durability and must be confirmed before valuing the deal.
Confirm licensing status, survey history, and any deficiencies or citations on all four Level II licenses. Regulatory compliance is existential in senior care, and outstanding survey findings, plans of correction, or memory care certification gaps can create liability and jeopardize the referral relationships that drive occupancy.
Scrutinize staffing: administrator tenure, caregiver turnover, wage rates, and reliance on agency labor. Because the sellers are retiring, confirm whether key administrators stay post-close, and stress test the cash flow against realistic wage inflation and any staffing shortfalls in the Utah labor market.
Validate the $853k cash flow with reviewed financials and normalize for owner add-backs, deferred maintenance, and real estate carrying costs. Confirm that reported cash flow reflects a fully staffed, arms-length operation and is not propped up by uncompensated owner labor or under-invested facilities.

Source

Originally listed on BusinessBroker.net. View original listing →