Pro-Forma vs. Actual Senior Housing Financial Statements – By Jason Punzel

As brokers, Senior Living Investment Brokerage, Inc. reviews senior housing financial statements for sellers on a regular basis.  We typically look at the trailing 12 months of financials to help determine the value of the senior living community, along with the price per unit of sales comparables.

When preparing an Offering Memorandum to market a property, typically, we rely on the trailing actual financials versus using a pro-forma financial statement.   It is very easy to make assumptions based upon the market (i.e. 92% occupancy, 40% margin, 3% rent growth, etc.) and apply it to a given property.   However, if it was really that easy, the current owner would have already made the changes needed to achieve the pro-forma!  We have found it more valuable to present the actual financials, while highlighting upside opportunities for a potential buyer.   The potential buyer is going to develop their own 10-year cash flow analysis anyway, based upon their own assumptions and plans for the given facility.


There are a few exceptions.  When there is a new facility, or large expansion, and the facility is in the lease-up process, it makes sense to develop pro-forma senior housing financial statements.   In this case, the trailing financials do not represent the near term future as the facility is moving towards a stabilization point.   This is a much different situation than a facility that has a track record of performing at a given level and without major changes, will probably continue to perform at a similar level.

Contact Information:

For more information about analyzing the financials of your senior living community, contact Jason Punzel at 630-858-2501 or

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Jason Punzel

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