Established Assisted Living Facility, 30-Room Texas Suburban Community

$2.0M

Revenue

$850K

SDE

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Full Editorial Writeup

This is a 30-room residential assisted living facility located in a high-growth suburban submarket in Texas. The physical plant consists of two identical single-story buildings, a purpose-built configuration common in the residential care model that keeps construction and operating costs lower than institutional high-rise senior housing. The facility serves seniors who need daily support with activities of living but do not require full skilled-nursing care, a segment that continues to expand as the population ages.

The business reportedly generates $850,000 in annual cash flow, which is a strong number for a 30-bed operation and implies high occupancy, disciplined labor management, and healthy per-resident revenue. In residential assisted living, profitability is driven by occupancy rate, private-pay mix, staffing ratios, and rent or mortgage cost on the real estate. A facility throwing off this level of cash flow at this bed count is running efficiently.

The real estate appears to be included, which matters because it changes how a buyer should underwrite the deal. Part of the return here is operating income and part is control of a hard asset in an appreciating suburban Texas market. That combination gives a buyer both cash flow and a financeable, collateralized building, which supports SBA 7(a) or conventional real estate financing.

Why we like it

Earnings quality is strong for the format: $850k in cash flow from a 30-room facility implies high occupancy and tight labor control. Residential assisted living carries recurring monthly revenue per resident, and turnover is gradual rather than transactional, which makes the income stream more predictable than most SMBs at this size.
The moat is physical and regulatory. Assisted living requires state licensing, staffing compliance, and a purpose-built facility, all of which raise the barrier for new competitors dropping into the same submarket. The two-building layout and existing license are not easily replicated by someone opening across the street.
The demographic tailwind is about as durable as it gets. Texas suburban population growth plus the aging of the 75-plus cohort drives structural demand for senior housing, and a high-growth suburban location means the addressable resident pool is expanding, not shrinking.
Senior care is genuinely recession-resistant. Families do not defer care needs because the economy softens, and private-pay assisted living tends to hold occupancy through downturns better than discretionary businesses. This is need-based demand, not want-based.
The real estate is included, so a buyer captures both operating cash flow and a collateralized hard asset in an appreciating market. That structure supports attractive financing and gives downside protection: even in a soft operating year, you own a financeable building.

How to improve it

Audit occupancy and rate immediately and build a waitlist funnel. If any of the 30 rooms sit empty, each filled bed drops almost entirely to the bottom line given fixed real estate and core staffing costs. Referral relationships with hospitals, discharge planners, and physicians are the cheapest occupancy lever.
Review the private-pay versus Medicaid mix and reprice where the market allows. Private-pay residents carry far better margins, and suburban high-growth markets often support annual rate increases that lag behind what the market will bear. Even a modest per-resident rate bump compounds meaningfully across 30 beds.
Tighten labor scheduling, which is the single largest cost line in assisted living. Optimize staffing ratios against actual acuity, reduce agency and overtime reliance, and cross-train caregivers. Small improvements in labor efficiency move cash flow more than almost any other operational change.
Add or expand ancillary revenue such as memory care wings, medication management fees, or higher-acuity care tiers. If the license and physical layout permit a memory care conversion in one building, that segment commands premium pricing and higher occupancy stickiness.
Formalize the referral and marketing engine with a placement-agency strategy (A Place for Mom and similar) and local digital presence. Many residential facilities run on word of mouth alone, leaving occupancy exposed. A repeatable inbound pipeline de-risks the single biggest revenue variable.
Evaluate a second-facility playbook using the included real estate as a financing anchor. If this operator has proven the model in one high-growth submarket, the two-building template is a repeatable expansion unit. Standardize the operating manual now to make future roll-out cleaner.

Diligence notes

Verify the $850k cash flow figure against tax returns, resident ledgers, and payroll records, and confirm whether it is stated before or after real estate debt service and owner compensation. Assisted living SDE add-backs can be aggressive, so isolate true operating profit from real estate value and any owner labor being run through the P&L.
Confirm state licensing status, survey history, and any outstanding deficiencies or citations. A clean regulatory record is essential, and unresolved violations can cap occupancy or threaten the license entirely, which would gut the value of the deal.
Analyze occupancy trend and payer mix over 24 to 36 months, not just a snapshot. A currently full facility that has been declining, or one heavily dependent on a single referral source or Medicaid reimbursement, carries hidden revenue risk that the headline cash flow hides.
Get a real estate appraisal and confirm exactly what is included in the asking price versus the operating business. Since the buildings are part of the deal, you need to separate the going-concern value from the real estate value to understand your true operating multiple and financing structure.
Assess the staffing situation, including caregiver turnover, wage rates versus local market, and reliance on agency labor. In a tight suburban labor market, staffing instability is the fastest way to lose your license or your margin, so understand the team you are inheriting.
Clarify seller transition support, which is currently not disclosed. Licensing transfer, resident and family relationships, and vendor contracts all need a clean handover, so nail down the seller's commitment to a transition period before closing.

Source

Originally listed on BizBuySell. View original listing →