Senior Housing in Arlington

A 60-resident, 5-unit senior housing community to be developed across 15,000 square feet of building footprint on a 1.31-acre site at 1415 N Fielder Road, Arlington, Texas. Total construction cost is estimated at $3,000,000 at $200 per square foot, financed through a $500,000 equity contribution from the senior housing operating partner and $2,500,000 in debt financing, with land contributed by the landowner as equity. The development will incorporate all amenities expected of a premium senior living facility — including landscaped gardens, freestyle outdoor fitness areas, dedicated parking, children's visitation play areas, and a fully engineered drainage system — designed to promote resident dignity, safety, and quality of life within a secure, purpose-built environment.  

Financial Breakdown:  

The project is mixed-financed with $1M of equity, composed of 50% cash and 50% land. The land’s market value is considered, henceforth, at $8.76 per sqft. The construction cost is projected at $200/sqft. A 30-year mortgage of $2.5M will be taken at 6% interest rate. The payments will follow a capital repayment structure. The attributable cash flows will be disbursed equally between the land owner and the housing facility. The ownership of the building will always remain with the landowner, and that’s why, if at the end of the 7th year the ownership is transferred, the landowner will go away with a total of $12.28M. On the other hand, the housing facility provider will receive a total of $5.49M. Thus multiplying their initial investment by 11.98X. The landowner will eventually multiply his investment by 38.97X. The project’s unlevered IRR is 56.02%, and the levered IRR is a whopping 152.10%. We believe on the sustainability of these numbers as senior housing is in high demand and our degree of operating leverage (risks from operating costs) is very low.

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