The need for senior housing, including assisted living, adult day care, independent living, and memory care, is significant. I assist clients in the three main phases of a senior housing project including development, management and licensing.
- Development. I primarily represent managers and operators through the process of bringing in sponsor equity, working with private lenders, and reviewing PropCo documentation (mainly LLC operating agreements) to be sure that the rights of my minority owner clients are protected. There are a lot of moving parts to the organizational documents in a senior housing project, so one of the keys of my practice is to be sure my clients understand what is required of them, and what they can expect in return, in plain English. Finally, keeping costs down is important. Legal expenses in the development phase aren’t covered by NOI, because there is no NOI yet. I work with clients efficiently, and get to know their nuances and KPIs in order to reduce the hours of legal time associated with document review and markup.
- Management. One of the main keys to a successful senior housing development is identifying a qualified and dedicated manager to run the facility once it is open. A good manager should also be able to work alongside the PropCo to consult during the design and construction phase as well. I most often represent the manager, ensuring that their management agreement is fair, provides the proper bonus incentives that are calculated fairly, and properly defines the roles that the PropCo, Operator and Manager will be fulfilling. Representing the Manager also often involves negotiating and documenting their promote interest, and developing a corporate structure that manages risk from one location to another.
- Licensing. Licensing requirements for senior housing projects vary widely from state to state. But for the most part, states are looking to ensure that the Operator has the ability, either on their own or through a Manager, to operate the facility with the properly qualified leadership and staff. They are seeking to ensure that the building meets certain minimum requirements for safety and security. They are seeking to ensure that the project has sufficient financial backing to succeed and properly care for its residents. And finally, they are seeking to ensure that the rights of the individual residents are protected. Each state approaches these basic needs very differently. I work with clients to navigate the sometimes dizzying maze of legal requirements, forms, and other submissions. Much of this work is actually not legal in nature, so I am happy to work with a client’s staff to train them on the non-legal aspects of licensing to keep legal costs down.