St. Albert and St. Walter are two elderly assisted living facilities providing 24/hour personal care and meals for their occupants, located in Scottsdale and Tempe respectively. The owner took out several loans against both properties to finance business operations at both locations.
Without notifying the secured lenders, the owner of the enterprise sold the business and assets at the Tempe property. This arrangement was in direct violation of his loan agreements. The new ownership of the Tempe location, unaware of the violation, assumed all management responsibilities and began renting property from the owner. Several months after the sale, the owner relocated overseas and abandoned both business enterprises and real estate.
Due to the loan violations and abandonment, a qualified receiver was required not only to secure the assets and prevent further violations, but also to protect the well-being and safety of the elderly residents.
The situation was complex – with the health and safety of vulnerable residents on the line, swift intervention was required to ensure both locations were operating in a safe and legal fashion.
The Scottsdale facility had been left in the care of a nursing professional who had been forced to manage all aspects of operational and administrative management in the absence of the owner. Resolute stepped in to assist the overburdened nursing professional in a variety of critical areas. This included creating and monitoring a petty cash account to allow for the uninterrupted care of the residents; establishing proper accounting practices; and overseeing several critical repairs and upkeep the property required.
The Tempe facility was included in the receivership estate. Resolute ensured Operational Licenses were valid, supervised regular rent payments made by the new owner-operators, oversaw various maintenance needs, and ensured that proper care was provided to the elderly residents of the property.
Resolute’s real estate marketing campaign for the properties proved successful. After a potential buyer fell out of escrow, we moved quickly to put the properties back under contract with a local buyer within days.
The Tempe facility offered the buyer a cash-flowing asset with lease in-place for the next three years with minimal landlord responsibilities; while the Scottsdale facility offered tremendous upside to the buyer through improving the operational business’ efficiency. Our real estate team was able to negotiate an all-cash, quick close for both transactions and handled the escrows simultaneously.
Resolute closed both transactions within 21 days. The transaction not only provided a full payoff for Lender, it also ensured the vulnerable occupants of both elderly assisted living facilities were in safe and secure care environments.