1. business and industrial
2. construction

SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
1.0 Executive Summary ............................................................................................... 1
1.1 Project Description .............................................................................................................. 2
1.2 Business Model ...................................................................................................................... 2
1.3 Project Location .................................................................................................................... 3
1.4 Sources and Uses................................................................................................................... 3
Sources .........................................................................................................................................3
Project Budget .............................................................................................................................4
1.5 Development Process and Project Timeline ................................................................. 6
Project Timeline..........................................................................................................................6
1.6 Job Creation Overview and EB5 Investor Opportunity.............................................. 7
1.7 Market Potential .................................................................................................................... 7
1.8 NAICS Codes Used for this Project ................................................................................... 8
1.9 Financial Opportunity ......................................................................................................... 9
Projections ...................................................................................................................................9
Financial Summary .................................................................................................................. 10
1.10 Value Proposition............................................................................................................. 11
2.0 Target Market Demand .......................................................................................14
2.1 Target Market Identification ........................................................................................... 14
2.1.1 Austin Senior Housing Market Metrics ...................................................................... 16
3.0 2012 Drivers of the Senior Housing Market ........................................................17
4.0 Sunset Arms..........................................................................................................24
4.1 Services Provided ............................................................................................................... 24
4.2 Facility and Room Layouts ............................................................................................... 27
4.3 Permits Required................................................................................................................ 29
5.0 Management Summary .......................................................................................30
5.1 Organization ........................................................................................................................ 30
5.1.1 Sunset Arms Management ............................................................................................ 30
5.1.2 Company Principals ....................................................................................................... 30
6.0 Staffing ..................................................................................................................32
6.1 Staffing Demand Analysis ................................................................................................. 32
6.2 Staffing Chart ....................................................................................................................... 33
6.3 Job Descriptions .................................................................................................................. 33
7.0 E-Verify .................................................................................................................46
8.0 Employment and Economic Impacts .................................................................47
8.1 Assumptions ......................................................................................................................... 47
8.2 Projected Economic Impacts ........................................................................................... 48
8.2.1 Projected Economic Impacts for Entire Project ........................................................... 48
8.2.2 Construction Jobs Overview Phases I and II ................................................................ 48
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
8.2.2.1 Total Construction Jobs Anticipated from Project ................................................................... 48
8.2.2.2 Total Impacts from Assisted Living Operations Years One and Two ................................. 48
9.0 Central Texas Economic Development .............................................................49
9.1 Central Texas Four-Region Demographics and Economy ....................................... 49
10.0 Austin-Red Rock MSA .......................................................................................53
11.0 Target Market Analysis ....................................................................................57
12.0 Demand Determinants .....................................................................................59
13.0 Market Analysis .................................................................................................62
13.1 Austin Assisted Living Market Potential ................................................................... 62
13.2 IBISWorld Industry Market Analysis for NAICS Code 623312............................. 64
13.3 IBISWorld Industry Market Analysis for NAICS Code 236620............................. 71
14.0 Competition .......................................................................................................79
15.0 Strategy and Implementation .........................................................................81
16.0 Financial Plan ....................................................................................................84
16.1 Balance Sheet Projection ............................................................................................... 84
16.2 Five-Year Annual Income Statement .......................................................................... 85
16.3 Five-Year Annual Cash Flow ......................................................................................... 86
Data Sources ...............................................................................................................88
S u n se t A r m s A s s i s t e d L i v i n g F a c i l i t y , L L C
Austin, Texa s
David Anheuser, Founder and CEO of Sunset Arm s Assisted
Con tact:
Living Facility LLC
Con tact E-mail:
davidanheuser@Sunset Arms.com
Location :
Sunset Arm s
15550 Ranch Road; 620 North Austin, Texas
Telephone Number:
(512) 961-0078
Fax Nu mber:
(512) 356-0351
Website:
www.SunsetArm s.com
Nu mber of Direct FullTime Employees:
58.4
EB-5 Financing Sou ght:
$11,000,000
Location of Project:
This document is a business plan and not an offering of securities. It contains confidential and
proprietary inform ation for the Sunset Arm s project.
S u n se t A r m s A s s i s t e d L i v i n g F a c i l i t y , L L C
Austin, Texa s
1.0 Executive Summary
The plagues of the human spirit run rampant in cold, sterile, social and
physical environments. Today’s retirement community residents want to
live within vibrant architectural and social frameworks that nurture a life
still worth living, not ones that reflect time spent waiting to die.
Empowerment, quality care, good health, and an enriched lifestyle for elders,
are the hallmarks of Sunset Arms.
Far more devastating than physical
illness to our elders, is lack of purpose.
Studies have shown that seniors who are
engaged
in
activities
they
find
meaningful are far more likely to retain
mental acuity, physical health and
emotional well-being.
Although the
hospital model tries to provi de such
stimulation,
activities
are
usually
organized by staff, with little or no input
from patients and become just one more
set of required tasks for all involved.
Elders
want,
need,
and
deserve
autonomy over their daily lives.
Sunset Arms envisions a different way
of ushering retirement community
residents through a new stage in their
lives, acknowledging that where they
live is their home and belongs to them, not to the staff.
It is the mission of Sunset Arm s to set a new standard of retirement living and to help
make retirement a new rewarding start in life full of excitem ent, class, beauty, safety
and comfort. These properties will be residential facilities in the truest sense of the
word.
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1.1 Project Description
Sunset Arms Assisted Li ving Facility, LLC is a Texas-based limited liability
corporation that has been formed for the purpose of developing and operating
an 84-unit assisted living facility for elderly patients. The company has targeted
a site in the Austin-Red Rock Metropolitan Statistical Area for the location of its
facility that will have a minimum of 84 assisted living units with a total initial
EB5 capital investment of $11,000,000.
The Sunset Arms Assisted Living Facility will have a minimum of 84 units
available for occupancy that is to be comprised of 84 assisted living units. When
construction is complete, the facility will be wholly owned and operated by the
developer who will directly support and staff services to residents including
nursing care, memory care, a schedule of activities, laundry and housekeeping,
dietary assistance, maintenance and security, and transportation.
Assisted Living Facility Design Overvie w
Unit Type
Availab le Beds
Assist ed L iving: S mall Stu dio Un it
24
Assist ed L iving: Mediu m S tu dio Un it
12
Assist ed L iving: L arge S tu dio Un it
2
Assist ed L iving: L argest S tu dio Un it
1
Assist ed L iving: S mall 1 B edr oom Un it
1
Assist ed L iving: L arge 1 B edroom Un it
1
Assist ed L iving: Mediu m 1 B edr oom Un it
11
Assist ed L iving: L arger 1 B edr oom Un it
1
Assist ed L iving: Mediu m 2 B edr oom Un it
6
Assist ed L iving: S mall 2 B edr oom Un it
6
Assist ed L iving: L arge 2 B edroom Un it
6
Total Capacity
84
Aver age Daily Cen su s (@ 84.5% occu pan cy)
71
1.2 Business Model
Sunset Arms will, as do many assisted living facilities, provi de services for
residents that require assistance with activities of daily living on a frequent
basis but do not have a high enough level of infir mity to require residence at a
nursing facility. These amenities and services range from housing, meals,
laundry,
housekeeping,
transportation,
social-recreational
activities,
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maintenance, and security, to other similar services that are not medical or
skilled nursing services. Clients that require assistance with instrumental
activities of daily living will have the option for management of medications,
finances, shopping, preparing snacks, meals, and housework.
1.3 Project Location
While chosen for a lot size that permits a relatively expansive urban
development, the location on Ranch Road was selected for its proximity to retail
and healthcare services.
1.4 Sources and Uses
Sources
The assisted living facility will be funded in sum by EB-5 capital obtained
through the Austin Regional Center and fundi ng from domestic sources.
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Sunset Arms Assisted Living Facility, LLC Project I: Capitalization Summary
1
2
3
Source
EB-5 Equity Investment
Domestic Equity Investment
Loans from Domestic Sources
TOTAL
Amount
$2,500,000
$2,200,000
$6,300,000
$11,000,000
NOTES
1. There will be an equity investment in the Project of up to $2.5 million from up
five EB-5 investors. The loan will have an interest rate of one percent to three
percent.
2. Investment from domestic sources includes equity contributions from the
project developer.
3. The project developer anticipates applying for a construction loan.
Project Budget
The Developer estimates that constructing the assisted care facility will require
a total of $11 million dollars, including $6.6 million in hard construction costs.
Sources and Uses of Funds
SOURCES
Loan from LP1 (EB-5 Capital)
Domestic Investment
Loans from Domestic Sources
Total Sources
$2,500,000
$2,200,000
$6,300,000
$11,000,000
USES
Land Acquisition
Hard Construction Costs
Soft Costs
Furniture, Fixtures & Equipment
Other (startup costs, working capital, etc.)
Total Uses
$1,650,000
$6,600,000
$1,500,000
$300,000
$950,000
$11,000,000
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Austin, Texa s
1. Land Acquisition: Includes purchase price, taxes, legal fees, and insurance.
2. Hard Construction Costs: Includes costs for materials and labor for shell and
core building construction, site costs (utility fees, signage, sidewalks,
landscaping) and interior construction.
3. Soft Costs: Includes permit fees, entitlement costs, construction management
fees, broker and retail commissions, insurance and taxes, loan costs,
financing costs, and contingency.
4. Architecture: Site and building planning
5. Engineering: Associated civil and structure planning
6. Furniture, Fixtures & Equipm ent: includes costs associated with interior buildout of the new facility.
7. Other: Includes startup costs for development (typically called mobilization
draws) for insurance that must be in pla ce prior to the insurance; deposits on
lumber and concrete for example. Working capital is for use during the lease
stabilization period to ensure the operations can continue even if the asset is
short in operating cash.
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1.5 Development Process and Project Timeline
The new assisted living facility will be a ground- up real estate construction
project with a development period of approximately two and a half years.
Stage
1. Design/Permitting/Construction
2. Initial Occupancy and Leasing Stab ilization
Hiring Year One and Two
TOTAL DURATION (Estimated)
Duration
12 months
12 months
24 months
1. Design and Permitting: When entitlements are complete and sufficient
financing has been secured, the project will be ready to break ground.
At this point the developer will finalize design plans and secure final
permits (time estimate: six months), and construction will commence.
The developer plans to finance this portion of the process through
developer equity.
2. Construction: The developer estimates a construction perio d of twelve
months, including site work, shell building construction, and interior
build-out. EB-5 funds will be combined with a construction loan and
developer equity to complete construction. Preleasing efforts will
begin at the half way point of construction.
3. Leasing Stabilization: The new facility will be owned and operated by
Sunset Arms, the project developer who will lease the indi vidual beds.
The developer estimates that the facility will reach a stabilized
occupancy rate (84.8%) after one year.
Project Timeline
Year One
Design, Perm itting and Construction Initiation
Design
Developer Equity Injected Here
Permitting
Construction
EB5 Monies Injected to Fund Preleasin g
Operational Hiring
Legal Stabilization Hiring
Stabilized Operations
58.2
45.0
Page 6
Year Two
13.2
S u n se t A r m s A s s i s t e d L i v i n g F a c i l i t y , L L C
Austin, Texa s
1.6 Job Creation Overview and EB5 Investor Opportunity
The Sunset Arms lifestyle will necessarily create employment opportunities in
the Austin MSA County area. Since the construction phase is slated to last only
one year, the direct jobs considered are those resulting from the operational
phase.
Impact Type
Employmen t
Labor Income
Total Value Added
Ou tpu t
58.2
$9,577,777
$23,254,374
$48,164,598
20.2
$2,244,355
$4,058,110
$6,751,795
31.6
$2,342,875
$4,836,188
$7,752,740
110
$14,165,006
$32,148,672
$62,669,132
Direct Effect
In direct Effect
In duced Effect
Total Effect
There are currently available opportunities for six direct investors to form one
of the cornerstone investments that will support the 58 jobs for initial operating
activity.
1.7 Market Potential
The project is in Austin MSA, the capital and a location consistently ranked near
the top of lists for the best place to retire. A feasibility study confirmed strong
demand for additional senior housing.
The numbers for the local industry indicate that the Company will not be
entering a saturated market and the opportunity to establish a niche foothold in
this market exists now.
Based strictly on revenue projections, the potential for the Austin MSA alone is
fully fifty percent that of Texas as a whole.
Projected Industry Growth in Austin MSA, Texas and the US to 2016
Year
2012
2013
2014
2015
2016
Austin MSA
$329,299,776
$352,350,760
$377,015,314
$403,406,385
$329,299,776
Texas
$1,537,580,000
$1,585,250,000
$1,675,600,000
$1,757,710,000
$1,880,870,000
United States
$51,252,600,000
$52,841,500,000
$55,853,400,000
$58,590,200,000
$62,695,500,000
S ource
The charts below, explored in greater detail in the market analysis section,
graphically represent the phenomenal opportunity in this market.
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Austin, Texa s
Regional Assisted Living Rental Rates Compared to Remainder of Country
Minimum
Rate Range
Median
Maximum
Median Annual
Rate
Five-Year
Annual Growth
$625
$3,300
$9,750
$39,600
6%
Texas – Whole State
$2,150
$3,750
$6,500
$45,000
13%
Austin MSA
$2,150
$3,815
$6,500
$45,774
14%
Region
USA
S ource
Austin MSA
Aggregate
Independent Living
Assisted Living
Occupancy
93%
93%
92%
Year-Over-Year Rent Growth
14%
14%
14%
Property Count
155
20
135
S ource
1.8 NAICS Codes Used for this Project
Below are the primary NAICS codes used for this project and their definitions.
623312 Retirement Communities
This United States industry comprises establishments primarily engaged in
providing a range of residential and personal care services with on-site nursing
care facilities for (1) the el derly and other persons who are unable to fully care
for themsel ves and/or (2) the el derly and other persons who do not desire to live
independently. Indivi duals live in a variety of residential settings with meals,
housekeeping, social, leisure, and other services available to assist residents in
daily living. Assisted-living facilities with on-site nursing care facilities are
included in this industry.
236220 Commercial and Institutional Building Construction
This industry comprises establishments primarily responsible for the
construction (including new work, additions, alterations, maintenance, and
repairs) of commercial and institutional buildings and related structures, s uch
as stadiums, grain elevators, and indoor swimming facilities. This industry
includes establishments responsible for the on-site assembly of modular or
prefabricated commercial and institutional buildings. Included in this industry
are commercial and institutional building general contractors, commercial and
institutional building operative builders, commercial and institutional building
design-build firms, and commercial and institutional building project
construction management firms.
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1.9 Financial Opportunity
Projections
The financial projections shown below are supported by the market information
in Section 2.0, Local Market Environment and Demand.
Financial Summary
Financial Summary
$60,000,000
$50,000,000
$40,000,000
$30,000,000
$20,000,000
$10,000,000
$0
1
$0
2
$0
Total Owner Equity
$6,472,753
$6,472,753
TOTAL ASSETS
$17,606,369 $34,480,802 $43,902,474 $45,766,423 $57,876,375
Cash
$2,978,051
Net Operating Income
$2,978,051
3
$3,200,460
4
$3,200,460
5
$3,200,460
$9,673,213 $11,740,527 $24,269,595
$3,200,460
$5,064,409 $17,174,361
EB5 Opportunity
This venture offers eleven EB-5 immigrant investors the opportunity to invest $1
million indivi dually in an EB-5 pooled investment with each investment
creating 10 jobs.
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Austin, Texa s
Investment Summary
The developer has already invested $2,200,000 for his own money. EB-5
investors become limited partners in a new entity tha t loans money to the
project. Each EB-5 investor receives a total return of 20% along with payoff of
their $1 million investment after approval of I-829 conditions for removal are
met. The investment must be sustained through this point to qualify for
permanent green card.
Financial Summary
Financial Summary
$60,000,000
$50,000,000
$40,000,000
$30,000,000
$20,000,000
$10,000,000
$0
1
$0
2
$0
Total Owner Equity
$6,472,753
$6,472,753
TOTAL ASSETS
$17,606,369 $34,480,802 $43,902,474 $45,766,423 $57,876,375
Cash
$2,978,051
Net Operating Income
3
$3,200,460
$2,978,051
4
$3,200,460
5
$3,200,460
$9,673,213 $11,740,527 $24,269,595
$3,200,460
$5,064,409 $17,174,361
Revenue Compared to Owner’s Equity
Revenue Compared to Owner Equity
$300,000,000
$250,000,000
$200,000,000
$150,000,000
$100,000,000
$50,000,000
$1
2
3
4
5
Operating Gross Profit
Page 10
6
7
Total Owner Equity
8
9
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Austin, Texa s
Income Compared to Owner’s Equity
Income Compared to Owner Equity
$300,000,000
$250,000,000
$200,000,000
$150,000,000
$100,000,000
$50,000,000
$$(50,000,000)
1
2
3
4
5
6
7
8
9
10
$(100,000,000)
Net Income
1.10 Value Proposition
Beyond what is believed to be phenomenal opportunity for a high -return
investment with long-lasting value, there are many current macroeconomic and
demographic considerations that support this venture. This is only bolstered by
the business model that will be introduced into the target market.

One of the most overri ding considerations for this venture is the existence
of a target market that is not only viable now but is estimated to grow
exponentially by the year 2050. A long recession essentially stopped
construction of new inventory in what was once a glutted market.
Circumstances, however, have changed.

Every year that baby boomers age another year, these facilities are more
in demand. At this juncture, the number of units under construction is in
no way keeping pace with the growth of the target market. Entrants into
this arena right now have a tremendous opportunity to establish a niche
foothold in an industry for which the need has already been established.

The occupancy rate for independe nt living properties in both Texas and
Austin averaged 93 percent in the fourth quarter of 2011. The average
occupancy rates for independent living and assisted living are both 1.2
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percentage points above their respective cyclical lows.

In the Austin area, year-over-year rent growth is anticipated to be double
that of the nation at 14%.

There is strong absorption for both independent living and assisted living,
exceeding the rate of new supply coming on line. For senior housing as a
whole, the increase in the occupancy rate is being led by independent
living. The first quarter of 2012 was the fifth consecutive quarter in which
the pace of annual absorption is above that of annual inventory growth,
resulting in rising occupancy.

Year-over-year rent growth for senior housing increased to 1.7 percent,
from 1.6 percent in the third quarter of 2011 and 0.8 percent in the fourt h
quarter of 2010.

The Company invests considerable time, money, and energy to ensure
residents are surrounded by beauty with striking architecture, lovely
landscape designs, and high-class finishes through the property.

This community will feature beautiful amenities such as a swimming
pool, sports and activities facilities, a tropical swimming pool, sports
classes, dancing, tai chi, yoga, table tennis, etc.

The Company will create a top-notch facility for the trendsetting facility,
which will help develop the great potential seniors carry within them.
Consultants, advisors and coaching people will be there to support
seniors in pursuing their interests and their enterprises.

The Company is committed to making meals a highlight of the day by
providing healthy, fresh, internationally inspired, tasty meals. Meals will
set a new standard since the company invests much more money per meal
per person than other facilities do. An internationally inspired chef will
work closely with Sunset Arms’ dietician to provi de meals which are as
balanced and nutritious as they are delicious.

This facility will be second to none in offering a wi de range of services in
a combination that best promotes resident well -being and ease. Sunset
Arms offers independent and assisted.

The Company is a profitable organization that believes that the best
advertising and best business comes through happy and satisfied
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residents. Commitment to its residents will be clear when prospective
residents see that facilities have:
 More employees in relation to the number of residents, provi ding
superior service.
 Commitment to excellence in all aspects of the organization.
 Unmatched concern for the comfort and well -being of residents.
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2.0 Target Market Demand
Support for the revenue projections and demand for this service in the AustinRed Rock Metropolitan Statistical Region are based on a number of sources,
described and cited in this section.
2.1 Target Market Identification
The following is the profile of the target.
Target Market Profile
Bastrop County Population Projection, Age 75+
Total Population
50-54
55-59
60-64
65-69
70-74
75-79
80-84
85+
65+
75+
2010
107,105
90,711
71,865
48,020
32,053
23,568
17,125
16,082
136,848
56,775
2012
112,368
98,792
79,891
54,509
35,696
24,979
17,733
17,681
150,598
60,393
Interpolated/Extrapolated to subject time period:
Total Population, 75+
2010
2011
2012
75-79
23,568 24,274 24,979
80-84
17,125 17,429 17,733
85+
16,082 16,882 17,681
2017
118,358
116,524
97,116
74,966
49,246
31,524
19,815
21,049
196,600
72,388
2013
26,288
18,149
18,355
2014
27,597
18,566
19,028
2015
28,906
18,982
19,702
2016
30,215
19,399
20,375
2017
31,524
19,815
21,049
2014
41,513
6,863
6,614
5,662
6,612
8,017
2,874
3,051
1,023
796
2015
42,975
7,025
6,571
5,593
6,679
8,769
3,161
3,227
1,109
842
2016
44,438
7,186
6,529
5,523
6,747
9,520
3,448
3,402
1,196
887
2017
45,901
7,348
6,487
5,454
6,814
10,271
3,735
3,577
1,282
933
Population with Income Projection, Ages 75+
Households by Income and Age of Householder:
Total
<$15,000
$15,000-$24,999
$25,000-$34,999
$35,000-$49,999
$50,000-$74,999
$75,000-$99,999
$100,000-$149,999
$150,000-$199,999
$200,000+
2012
38,587
6,540
6,698
5,801
6,477
6,515
2,300
2,701
850
705
2017
45,901
7,348
6,487
5,454
6,814
10,271
3,735
3,577
1,282
933
Interpolated/Extrapolated to subject time period:
Ages 75+
2010
2011
Total
----<$15,000
----$15,000-$24,999
----$25,000-$34,999
----$35,000-$49,999
----$50,000-$74,999
----$75,000-$99,999
----$100,000-$149,999
----$150,000-$199,999
----$200,000+
-----
2012
38,587
6,540
6,698
5,801
6,477
6,515
2,300
2,701
850
705
2013
40,050
6,702
6,656
5,732
6,544
7,266
2,587
2,876
936
751
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Unmet Demand Calculation
Primary Market Area (PMA) Unmet Demand Definition
Number Needing Assistance
Age
75-79
80-84
85+
% Needing Assistance
19.5%
Dependent
on Analysis-Type
31.2%
49.5%
2012
2013
2014
2015
2016
2017
6,117
6,921
11,051
6,431
7,068
11,472
6,745
7,261
11,893
7,059
7,363
12,314
7,373
7,645
12,734
7,687
7,568
13,155
Number of Income-Qualified
2012
2013
2014
2015
2016
2017
Age
75-79
80-84
85+
3,099
3,506
5,599
3,366
3,699
6,004
3,635
3,913
6,410
3,907
4,075
6,815
4,181
4,335
7,221
4,457
4,388
7,627
Gross Market Available:
12,203
13,069
13,958
14,798
15,737
16,471
42%
42%
42%
42%
42%
42%
5,125
5,489
5,862
6,215
6,610
6,918
% of Gross Market representing
demand from couples Demand Refining Step B
11%
11%
11%
12%
13%
14%
Demand
% of Gross from outside
PMA Refining Step C
15%
15%
15%
15%
15%
15%
Demand Refining Step D
Net Market, Age,Income,Status
8,298
8,887
9,491
10,210
11,016
11,694
Demand Refining Step E
1,483
1,483
1,489
1,489
1,495
1,501
Net Market Available, Net Exsting Units
6,815
7,404
8,002
8,721
9,521
10,193
Estimated Penetration Rate
25.4%
24.4%
24.1%
23.2%
23.9%
24.2%
Final Available, Unmet Demand
1731
1807
1929
2023
2276
2467
Demand
% of Gross Market Living
Alone: Refining Step A
Number of Gross Market Living Alone:
Sub-Total
Existing Units
The final unmet demand calculated above clearly indicates that the region will
easily accommodate the assisted living units introduced by this facility. Based
on this, the Company turned to validation of its anticipated staffing needs
against industry and local area standards, as shown in the analysis below.
The Company has derived its revenue projections from both national industry
benchmarks as well as regional industry information.
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2.1.1 Austin Senior Housing Market Metrics
Property Types
Majority Independent Living
Majority Assisted Living
Metro
MAP32-100
Metro
MAP32-100
Stabilized Occupancy
93.20%
90.40%
92.20%
90.60%
Average Monthly/Daily Rent
$3,523
$2,565
$3,764
$3,321
Median Age
15
22
13
15
Median Units/Beds Per Property
151
159
63
61
65.00%
64.10%
95.80%
88.00%
20
758
85
1,546
Inventory
3,653
159,378
1,609
110,746
Independent Living Units
2,886
114,104
44
5,890
444
25,183
1,483
101,209
9.50%
6.70%
4.20%
4.70%
0
2,807
312
3,565
For Profit (%)
Property Count
Assisted Living Units1
Penetration
Construction Units/Beds
1. Includes Memory Care
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3.0 2012 Drivers of the Senior Housing Market
The Retirement Communiti es industry will exhibit accelerated growth in the
next two decades. An aging population and growing need for dementia care
(care provided to those with memory impairment) are stimulating much of the
industry's growth. Retirement communities provide a numb er of services for
seniors who suffer from chronic illnesses to assist them with activities of daily
living. Over the past five years, the number of assisted living facilities that
provide dementia care has risen as a proportion of total facilities. On the other
hand, companies that do not include these services have suffered by the changes
in the housing market and economy.
During the five years to 2017, an improving economic environment, an aging
population, healthcare reform legislation and new service offerings will
facilitate industry growth. It is estimated that industry revenue will grow at an
annualized rate of 4.9%, reaching $65.1 billion in 2017. As the housing market
improves, more seniors will be able to sell their homes and pay resident fees.
However, the unstable commercial construction market will keep the supply of
retirement and assisted living facilities low, despite expected increased finances
for this market. As a result, further mergers and acquisitions are expected, with
the number of industry companies projected to decrease an average of 0.5% per
year during the next fi ve years to 14,464. In addition, technological advances
and new architectural designs will play a crucial role in industry growth as
demand for innovative amenities strengthens. Many trends will drive the senior
market in 2012, among them the following:
1. Higher Levels of Acuity - Increased Risks and Costs
Senior living and housing provi ders are beginning to experience higher levels of
acuity (aka sickness) for their prospective residents. This elevates the risk of
entrance and subsequently the cost of provi ding care.
Acuity levels are rising because many seniors have delayed the entry for
economic reasons, and they’ve become more accustomed to utilizing family,
technology, medicine and community support to remain in their current
environment.
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Higher acuity levels can lead to a higher cost of care, and providers may need to
raise their costs as a result of increased risk, or change their policies all together
to avoid the consequences of higher acuity. This may in turn force government
benefits programs into playing an even larger role in funding seniors’ care, and
it’s also possible seniors may face discrimination for entry into facilities based
on their acuity level.
2. Senior Housing Community Evolution - Shift in Brick and Mortar Functions
As the profile of senior housing residents change, so will the definition of types
of senior care communities. The shift in resi dent profiles is giving way to a
migration in communities:
• Independent Li ving Becomes More Like Assisted Living. As more home and
community based services initiatives are implemented, seniors living in
apartment complexes or 55+ communities will see a greater level of a la carte
services offered that will resemble more of an assisted living “feel” at a lower
cost delivery as services will be unbundled.
• Current Assisted Living Facilities will function more like Skilled
Nursing. Current nursing homes will be handling the “sickest” seniors in the
coming years as an alternative to hospital stays. The traditional model of
nursing care will migrate to assisted living communities that can have differing
levels of care within those communities. As part of this trend, many assisted
living communities are finding that the average age of entry for its communities
is increasing as people are living with less care longer.
• Dedicated Alzheimer’s care facilities will begin to re -appear in earnest in the
next 12-24 months. This trend is similar to a period in the early 2000s when
many dedicated memory care communities were established. At the time, there
were funding problems and the trend was somewhat ahead of its time given the
number of memory care patients. However, a decade later, the supply of
assisted living/dementia care communities is low while the demand is steady
and increasing, regardless of the funding issues.
3. Aging in Place: Local Community Footprint Expand s With Home and
Community Based Services
Migratory trends for seniors are decreasing as the economic effects are more
devastating than previously imagined, which leads to seniors remaining in their
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local communities longer. However, the definition of “local community” is
changing or better yet expanding. Before the definition of local communi ty used
to be defined a 10-15 mile radius, it now encompasses an expanded area of
almost 100 miles, based on supply, demand and costs.
This expanded radi us is possible as home and community based services and
networks are growing, predominantly in major metropolitan markets. Senior
living communities and hospitals are partnering more closely to offer a full
continuum of care as an extension of their brick and mortar campuses. These
marketing efforts are designed to ease seniors into the system of care, s tarting at
home and provi ding opportunities to expose indivi duals to the levels of care
and communities they’ll be able to choose from when it becomes necessary. The
linkages from home health care, clinic, rehab centers to assisted living and
skilled nursing facilities will blur more as the power of the network of care
becomes greater, and once in the network, indi vi duals may find themselves to
be “customers for life.”
4. Creative Senior Living Solutions Gain Traction – Communal Living and
Multigenerational Housing
Concepts such as multigenerational housing, the Greenhouse Project, senior
villages, co-housing, homes built with in-law apartments and other communal
living solutions will continue appearing and evolving as indi viduals and
families learn about the costs of senior housing. The el derly will increasingly
move in with their families—or each other— as the economics of co-housing/cohabitation make a compelling case for multigenerational housing. Each of these
solutions provi des maximum flexibility but as these models become more
popular, regulation and fundi ng to further develop these alternatives may stall
future growth.
Those living in single-family homes will invest capital in their homes as more
parents move in with their adult children. Using home office spaces, basements,
attics and other existing solutions will make way for more formal renovations
including the “grannie apartment” as either an add-on or standalone. Unlike
additions for bathrooms or kitchens, the resale value of “grannie” ren ovation
shoul d be discounted greatly when considering the costs if given any
consideration at all. Others may opt for pre-fab cottages or PODs as solutions
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that can be moved, stored or re-sold when a senior needs to move to a more
comprehensive care community.
As the housing market stays stuck in neutral through 2012, money will be
invested in making the home more of a multi -generational dwelling out of
necessity. Renovation will be a key dri ver in adaptation for senior housing in
both single family homes.
The key will be the return on the investment (ROI) but given the uncertainty of
the amount of time that an elder may live with their children, it is difficult if not
impossible to have a sense of certainty with respect to time. The resale value of
these enhancements or modifications will have negli gible effect on the value of
the home unlike more popular renovati ons such as kitchens and baths.
5. Politics and the Need for Affordable, Assisted Living
Partisan politics and the election year will do li ttle to advance senior housing
policy within the next 12 months. The good news is that the election will bring
sobering discussions about the future of health care and senior care. Medicare,
Medicaid and other entitlement programs will be at the forefro nt of the
campaign, as the country’s ability to pay its bills, both operating costs and debt
service, is called in question. Politicians are realizing that the aging
demographics in America are an economic train wreck waiting to happen and
are identifying the problem but not discussing any concrete solutions.
The greatest policy challenge yet to be fully addressed is the need for some type
of affordable, assisted living for low-income Americans. This includes solutions
for simple services to assist with the activities of daily living (ADLs) and
memory care.
Even considering low-to-moderate income standards, will these ratios and
income percentages be realistic (e.g. 60% of median area income)? Congress and
state legislatures will need to conceptualize a nd develop some kind of interagency solution that bri dges the gap between housing and care.
6. Senior Care Technology – Monitoring and PERS Go Mainstream
Senior care technology will begin to become more mainstream both for aging in
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place and for those in communities. More applications (or “apps”) will be
developed for a range of devices including laptops, PCs, tablets and smart
phones. Cross-platform applications will be critical as care givers (both
professional and familial) will want to carry their o wn devices and won’t want
to carry multiple devices. As end users of technology fall into the younger
spectrum, more companies will provide solutions that integrate into the existing
technology platforms.
Personal Emergency Response Systems (PERS) will b ecome more prevalent and
blend in more with everyday life. Technologies for monitoring will begin to
focus on habits and indivi dual behaviors on mundane tasks that don’t require
specific interaction with a device. Monitoring pressure in beds, trips to the
bathroom, turning on the coffee pot in the morning are examples of simple
monitoring techniques that, when monitored for exception processing purposes,
provide a means of monitoring without direct user interaction with any device.
For seniors who are less technologically savvy, the television still is the primary
electronic device that is connected in their home or their room in the community
in which they live. Cable television operators have a strong position to deliver
more telecare and monitoring services through their “pipes” and their
boxes. Look for set top box manufacturers and cable companies to develop
interfaces and applications built in for senior care.
7. Real Estate - Land Rush, Location, Housing Discrim ination
Home prices will continue to present challenges for senior housing communities
across the US in 2012. As the job market improves slightly during the course of
2012, the housing market will firm up and provi de a solid bottom for housing
prices in good markets. For markets that have an exorbitant amount of
foreclosures,
it
will
still
be some
time
before
those
markets
change. Communities will still have a lag factor as many seniors that may want
to move in will still be reluctant to sell their home at current market
prices. Once the housing market recovery gains traction, there could be a surge
in demand for independent living communities as capital is released after the
sale of the home.
Land acquisition and development will become critical in 2012 as competition
for prime locations intensifies. The good news is that low financing rates will
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help make the carry on the new acquisitions more palatable but put pressure on
banks to provi de construction financing. Locations acquired during the next 12
months will be the new communities s tarting in late 2013 and
2014. Municipalities will need to address permits and application for new
senior housing projects on these parcels as both a means to provide community
support and an attempt to increase tax revenues for their communities. The
days of NIMBY should start to diminish as residents realize that lack of supply
for good senior housing in local communities.
Housing discrimination against seniors will begin to gain national attention
during 2012. As seniors are forced to downsize and c hange their lifestyles,
landlords may begin to show delicate signs of age discrimination.
8. Financing For Senior Housing Communities – How Long Can Rates Stay
Low?
Rates will stay low for the balance of 2012 thanks to the efforts of the Federal
Reserve and the troubles that remain with the European banking
system. Senior housing provi ders will have a window of opportunity to lock in
these low rates for the next 12 -18 months that gives those who are building or
renovating time to get their communities fi lled up.
Banks will continue to loosen up their underwriting requirements as
competition heats up for established owners and operators, and more banks will
look at smaller or less-experienced operators in an effort to expand their
lending. Banks will become more interested in the details of the underlying
operating model for each community financed, looking for functional and
financial flexibility to change and adapt with supply and demand in the local
marketplace. In 2012, regional banks will have an upper hand with senior
housing construction financing with knowledge of local markets and
demographic trends and REITs (real estate investment trusts) and large, national
banks will provi de the long-term financing options. REITs held the upper -hand
in the capital markets in 2011 and will most likely remain king of the jungle as
long as rates stay low.
As older communities begin to show their functional obsolescence, many senior
housing companies will need to examine their current buildings and make
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decisions about renovating or starting from scratch. The costs for renovation
shoul d remain less expensi ve than new construction if feasible.
9. Personal Finance Challenges and Long-Term Care Insurance
Declines in the net worth of American population presents bot h short and long
term challenges to senior living. If the United States enters a new recession or a
slow, steady growth trajectory through 2012, it will do little for retirement
savings for those who find it necessary to move into senior housing
communities. Coupled with a continued challenged residential real estate
market, the trend for improved net worth in the 55+ crowd seems unlikely in
2012. As families move in together and more children are caring for their
parents, the prospect of financial abuse looms larger and will create some
societal challenges where lines are blurred as family members manage finances
for their parents.
Long-term care insurance is becoming more prevalent and will continue to grow
in senior housing communities during 2012. As younger seniors enter
communities with LTC insurance, the increases in the administrative work and
burden on supporting handling LTC insurance claims added with any kind of
additional support adds to the overhead costs for owners and operators. At
some point, these additional costs will be passed along through rate increases in
one fashion or another. The good news is that some communities are finding
that their newer entrants have a well-balanced retirement plan that includes
LTC insurance but the bad news is that those seniors may become “high
maintenance” residents given the complexity of their LTC insurance.
10. More Senior Living Professionals Needed for Growing Industry
No matter how well a community is constructed, the overall basis for a well -run
community is the people that make it operate on a day -to-day basis. The senior
living industry will see increased demand for qualified professionals that will
provide more upward pressure on wages compared to the last two years based
upon supply and demand. With funding cut backs anticipated for both Medicare
and Medicaid programs, government agencies at both the federal and local level
need to provi de more training and support funds to cope with the employee
development challenges. Compounding the people crisis is the crackdown on
overtime regulations for home-care provi ders.
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4.0 Sunset Arms
4.1 Services Provided
A paradigm shift in the way many fam ilies live has slowly altered the face of the
American way of life over the last hundred years. The C om pany will take advantage of
the opportunity to participate in this change.
Long-since abandoned are the traditional
living arrangements where families lived
together
or
even
in
the
same
neighborhood or city.
Undeniably,
economic changes have fostered some of
this change but there are new sets of
rules being evolved for communities.
After a decades-long hiatus where
community was an oft-forgotten concept,
those of like mind who want to live
together and want to live with others
whose vision of the community is the same are now forging new communities.
These communities include today’s assisted living communities.
Sunset Arms Assisted Living Facility, LLC will introduce into the Austin MSA a
concept that, while it exists in theory, has not yet fully been realized. Bridging
the gap between l uxury retirement community care and high-end nursing home
care, Sunset Arms will provi de an upscale assisted living environment where
the quality of life is matched only by the medical foundation that underlies it.
At least, the facility will offer the following:


Spacious apartments featuring kitchenettes, private baths, views and
personalized security response systems
Fine dining offering three delicious meals each day with an array of




comfort food and healthy choices
24-hour onsite nursing staff and personal assistants
Onsite physical therapy, outpatient rehabilitation and exercise programs
Full-time activity director and innovative recreation programs
Supporti ve services that include transportation, laundry assistance,
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

housekeeping and a concierge
A state-of-the-art memory care program that focuses on the needs of the
indi vidual and creating a peaceful, serene environment
What this facility will not be is a huge sprawling community. Focused on
a small number of residents at any one time, the organization will enable
the staff to provide the best care possible to its residents.
Anyone who has cared for an Alzheimer’s victim knows that this is not a
responsibility that permits inattention.
Left unattended, a resident with
Alzheimer’s may look fine but do something unpredictable —and something that
endangers their health—the next. This facility will provi de a compassionate care
setting for such people. All professional staff, nursing personnel, and caregiver s
are specially trained in Alzheimer’s and dementia -related care. Ongoing
education and training allows the facility to provi de the latest and highest
quality of care to meet the unique needs of its residents
Memory Care Program and Units
The Sunset Arms Memory Care Community is designed to provi de a secure
environment for persons with Alzheimer’s disease and related memory
impairments. Residents are able to enjoy comfortable living areas, colorful
dining rooms and a secure courtyard with covered porches , gardens and
walking paths. You can expect excellence in the following services and
programs:





24-hour personal assistants and on-site nurses available to respond to
resident needs, including bathing, dressing, hygiene, grooming,
supervision, anxiety, wandering and socialization
Structured activities, supervised di ning and exercise programs
Health monitoring, including medication administration; incontinence
care; and coordination of medical services
On-site care planning by an experienced team of heal thcare professionals
Quarterly assessments to ensure services continue to meet the needs of
each resident and encourage personal involvement in activities of daily
living.
The Dementia and Memory Care Response System
The community is equipped with a rel iable alert and staff call system that can
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actually summon the care staff to the resident’s apartment without the resident
being cognitively alert. Behavior or incidents requiring staff assistance is
reported to our care team through a silent wireless pag ing system while
maintaining a calm environment. The system can alert staff to respond
promptly to residents with a high risk of falling or who require assistance with
activities of daily living.
These units have been specifically designed to minimize s eparating walls, which
allows the resident freer movement throughout their apartment.
Assisted Living Program and Units
These units are notable for their quality, ambiance and the serenity of the
surroundings. They include:

Spacious apartments featuring kitchenettes, private baths, courtyard
views and personalized security response systems

Fine dining offering three delicious meals each day with an array of
comfort food and healthy choices

24-hour on-site nursing staff and personal assistants

On-site physical therapy, out-patient rehabilitation and exercise programs

Full-time activity director and innovative recreation programs

Supporti ve services which include transportation, laundry assistanc e,
housekeeping and a concierge.
Trained and caring resident assistants provide medication management, daily
walking assistance with escorts, important daily reminders, diabetic
management, continence care and daily living assistance with dressing, bathing
and grooming. By offering quality support services, a s well as positive
interactions and experiences, the goal is to reduce frustration and confusion.
Staff members learn the backgrounds, history and important lifestyle routines of
each resident, including favorite activities, food preferences and persona l care
routines. Giving residents purpose is a major component of all Sunset Arms
programs.
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4.2 Facility and Room Layouts
Gui delines from the Alzheimer’s Association were used to create a soothing and
peaceful atmosphere provi ding residents a sense of comfort, dignity and well being all in a warm, familiar, home-like setting.
In addition, outdoor
programming gives residents an opportunity to enjoy and experience nature in a
safe setting. It is believed that in the Memory Care Unit or not, this approach is
a sound one.
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At Sunset Arms, each resident receives an indi vidualized fram ework for care that
is continually adjusted as needs arise and is designed to promote engagement,
socialization and independence.
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4.3 Permits Required
Licen se Name
Requ irements
Texas Application for State
License to Operate a LongTerm Care Facility
Completed applications for a license must be
subm itted 45 days before the building is
expected to conform to the Life Safety Code
and architectural requirements.
Done
Texas Department of Health
Food Establishment License
All establishments engaged in cooking and/or
serving food must be inspected by the State of
Texas in order to ensure compliance with
safety regulations.
Done
Texas
Assisted
Living
Facility Type B - Alzheimer's
Disease
and
Related
Disorders
Completed applications for a license must be
subm itted 45 days before the building is
expected to conform to the Life Safety Code
and architectural requirements.
Done
Texas Sales Tax and Use
Permit
All businesses in Texas need to register with
the Texas Comptroller of Public Accounts.
Done
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5.0 Management Summary
5.1 Organization
5.1.1 Sunset Arms Management
David Anheuser,
Chief Operating
Officer
Administrative
Assistant
Ann Davis, Health
Services
Administrator
Gerald Gervais,
Financial Director
Sam Arnheim,
Marketing Director
5.1.2 Company Principals
David Anheuser – President and C hief Operating Officer, the Sunset Arms
Assisted Living Facility, LLC
As President and Chief Operating Officer, Mr. Anheuser leads the business
operations of the Sunset Arms Assisted Living Facility, LLC. A proven
entrepreneurial business leader and a licensed architect and general contractor,
Mr. Anheuser has built a number of successful real estate services companies
including Counterpoint Builders, which performs design, construction,
development and finance for its clients. Mr. Anheuser and Counterpoint
Builders have designed and developed over $750 million of commercial real
estate. Counterpoint Builders is regularly recognized by the Austin Business
Journal. Most recently, Counterpoint was ranked number thirty-six of Austin’
Fastest Growing Businesses. He holds a Masters in Architecture from The
Uni versity of Alabama at Birmingham. Previously, he earned a Master’s in
Business Administration from the University of Southern California in Los
Angeles, California.
Gerald Gervais – Financial Director
Mr. Gervais has experience covering all areas of real estate analysis, business
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planning, and large project solutions. O ver his career, he has financed
approximately $1 billion of commercial real estate transactions. He is primarily
responsible for management of the Sunset Arms Assisted Li ving Facility, LLC
Investor Visa program. Mr. Gervais has lived in numerous countries around the
world including Dubai, China and Japan. Mr. Gervais received his Master’s in
Finance from Baylor University.
Ann Davis, Health Services Adm inistrator
Ms. Davis is an accessible, effective health administrative leader who has
successfully trained and retained a staff of resident-focused healthcare
personnel in her current position as administrator of Austin’s Bethany Assisted
Living Center. She is a skilled initiator of marketing strategies and process
improvement plans in order to maintain a competitive industry advantage and
effectively resolve organizational issues. She has already demonstrated her
commitment to the concept of resident-centric care and has in fact initiated
several programs with attendant policies and procedures in her c urrent position.
Ms. Davis has a Masters of Health Services Administration (M.H.S.A.),
Uni versity of Michigan School of Public Health.
Sam Arnheim, Marketing Director
Mr. Arnheim is a highly skilled sales and marketing professional with proven
experience in building relationships, networking within the assisted living
target market, provi ding excellent customer service and closing sales. He was
directly responsible for a ten percent increase in occupancy in two assisted
living facilities and brought one from startup to full occupancy within a year.
With more than 12 years of experience,
with strong credentials and a proven
industry. He has been director of both
functions. At Florida State Uni versity,
Administration.
he is a highly motivated professional
track record in the senior housing
marketing and market ing and leasing
he received his Master’s in Business
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6.0 Staffing
6.1 Staffing Demand Analysis
The Company validated its anticipated staffing needs against industry and local
area standards, as shown in the analysis below. Their predicted staffing level of
58 is well within local standards.
Revenue Comparison
MARKET
The subject property is located in Austin, Texas, Bastrop County
REVENUE COMPARISON
The Subject Property is providing the following units and monthly rates:
Type
Quantity
Small Studio Unit
Medium Studio Unit
Large Studio Unit
Largest Studio Unit
Small 1 Bedroom Unit
Large 1 Bedroom Unit
Medium 1 Bedroom Unit
Larger 1 Bedroom Unit
Medium 2 Bedroom Unit
Small 2 Bedroom Unit
Large 2 Bedroom Unit
30
11
2
1
1
1
11
1
1
1
1
Monthly Rent
$1,500
$1,900
$2,400
$3,200
$3,500
$3,900
$3,750
$4,200
$4,500
$3,900
$4,900
Total Revenue
Assisted Living
Total Number
of Units
Assisted Living
Cost-per-Unit
per-Month,
Assisted Living
$1,680,600
31
$4,518
The Primary Market Area -- Bastrop County -- contains the following current-market characteristics
Characteristic
Current Inventory, Majority AL
Average Monthly Rent
Stabilized Occupancy
Value
1483
$3,764
92.2%
Current-Market Properties
Arden Courts Alzheimer's AssistedLiving
11630 Four Iron Dr Austin. TX 78750
Argent Court Assisted Living
508 Old Austin Hwy Bastrop, TX 78602
Barton Hills Assisted Living
1606 Nash Ave Austin, TX 78704
Cedar Ridge Alzheimers
2100 S. Lakeline Blvd Cedar Park, TX 78613
Colonial Gardens
3700 Adelphi Lane Austin, 71X 78727
Cottages at Chandler Creek - TheNorth Cottage
2401 North AW Grimes Blvd Round Rock. TX78665
Elmcroft of Austin
7017 Manchaca Rd Austin, TX 78745
Emeritus at Beckett Meadows
7709 Beckett Rd Austin, TX 78749
Emeritus at North Austin
5310 Duval Rd Austin, TX 78727
Emeritus at San Marcos
1401 Wonder World Dr San Marcos, TX 78666
Emeritus at Spicewood Springs
4401 Spicewood Springs Rd Austin, TX 78759
Emeritus at Vista Oaks
1604 Lohmans Crossing Rd Austin. TX 78734
Grace House of Lake Travis
11825 FM 2244 BEE CAVE, TX 78738
Heather Wilde Assisted Living
401 Heatherwilde Blvd Pflugerville, TX 78660
Parmer Woods, A Merrill GardensCommunity
12429 Scofield Farms Dr Austin, TX 78758
Round Rock
8005 Cornerwoocl Dr Austin, TX 78717
San Marcos
1720 Ranch Road 12 San Marcos, TX 78666
Si lverado Senior Living - OnionCreek
11330 Farrah Lane Austin, TX 78748
Sterling House of Georgetown
2600 E University Ave Georgetown, TX 78626
Summit at Northwest Hills
5715 Mesa Dr Austin, TX 78731
The Cottages at Chandler Creek -The South Cottage
2351 North AW Grimes Blvd. Round Rock. TX78665
The Isle at Cedar Ridge
2200 S Lakeline Blvd Cedar Park, TX 78613
The Legacy at Georgetown
4909 William Drive Georgetown, TX 78633
The Pavilion at Great Hills AssistedLiving and Memory Care Community
11819 Pavilion Blvd Austin, TX 78759
The Pointe at Cedar Park
450 Discovery Blvd Cedar Park, TX 78613
University Village Memory Care
4701 Campus Village Dr. Round Rock. TX78665
Wyoming Springs Assisted Livingand Memory Care
7230 Wymoning Springs Drive Round Rock TX78664
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Sales Per Employee Forecast
The information below is provided by Bizminer for Bastrop, County, for the "Sector: Health Care-Social Assistance" :
Annual Sales per Employee
2010
2011
2012
Average
$67,271
$72,147
$73,239
$70,886
Subject Property, Number of Required Employees to support forecasted revenue:
Revenue
Projected
Staff Requirement
2014
2015
2016
2017
2018
$2,354,486
$3,817,793
$3,968,331
$4,187,248
$4,798,169
33
54
56
59
68
6.2 Staffing Chart
6.3 Job Descriptions
Executive Director
Determine and formulate policies and provi de overall direction of companies or
private and public sector organizations within gui delines set up by a board of
directors or similar governing body. Plan, direct, or coordinate opera tional
activities at the highest level of management with the hel p of subordinate
executi ves and staff managers.
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Tasks
 Direct or coordinate an organization's financial or budget activities to
fund operations, maximize investments, or increase efficiency.
 Confer with board members, organization officials, or staff members to
discuss issues, coordinate activities, or resolve problems.
 Analyze operations to evaluate performance of a company or its staff in
meeting objectives or to determine areas of potential cost reduction,
program improvement, or policy change.
 Direct, plan, or implement policies, objectives, or activities of
organizations or businesses to ensure continuing operations, to maximize
returns on investments, or to increase productivity.
 Prepare budgets for approval, including those for funding or
implementation of programs.
 Direct or coordinate activities of businesses or departments concerned
with production, pricing, sales, or distribution of products.
 Negotiate or approve contracts or agreements with suppliers, distributors,
federal or state agencies, or other organizational entities.
 Review reports submitted by staff members to recommend approval or to
suggest changes.
 Appoint department heads or managers and assign or delegate
responsibilities to them.
 Direct human resources activities, including the approval of human
resource plans or activities, the selection of directors or other high -level
staff, or establishment or organization of major departments.
Business Office Manager
Plan, direct, or coordinate one or more administrative services of an
organization, such as records and information management, mail distribution,
facilities planning and maintenance, custodial operations, and other office
support services.
Tasks
 Direct or coordinate the supportive services department of a business,
agency, or organization.
 Prepare and review operational reports and schedules to ensure accuracy
and efficiency.
 Set goals and deadlines for the department.
 Acquire, distribute and store supplies.
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





Analyze internal processes and recommend and implement procedural or
policy changes to improve operations, such as supply changes or the
disposal of records.
Plan and administer budgets for contracts, equipment and supplies.
Monitor the facility to ensure that it remains safe, secure, and well maintained.
Hire and terminate clerical and administrative personnel.
Oversee the maintenance and repair of machinery, equipment, and
electrical and mechanical systems.
Oversee construction and renovation projects to improve e fficiency and to
ensure that facilities meet environmental, health, and security standards,
and comply with government regulations.
Community Relations Director
Engage in promoting or creating an intended public image for indi viduals,
groups, or organizations. May write or select material for release to various
communications media.
Tasks
 Respond to requests for information from the media or designate an
appropriate spokesperson or information source.
 Study the objectives, promotional policies, or needs of organizations to
develop public relations strategies that will influence public opinion or
promote i deas, products, or services.
 Plan or direct development or communication of informational programs
to maintain favorable public or stockholder perceptions of an
organization's accomplishments or agenda.
 Establish or maintain cooperative relationships with representati ves of
community, consumer, employee, or public interest groups.
 Prepare or edit organizational publications for internal and external
audiences, including employee newsletters and stockholders' reports.
 Coach client representatives in effective communication with the public or
with employees.
 Confer with production or support personnel to produce or coordinate
production of advertisements or promotions.
 Confer with other managers to identify trends or key group interests or
concerns or to provi de advice on business decisions.
 Arrange public appearances, lectures, contests, or exhibits for clients to
increase product or service awareness or to promote goodwill.
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
Consult with advertising agencies or staff to arrange promotional
campaigns in all types of media for products, organizations, or
indi viduals.
Receptionist
Answer inquiries and provide information to the general public, customers,
visitors, and other interested parties regarding activities conducted at
establishment, offices, and employees within the organization.
Tasks










Operate telephone switchboard to answer, screen, or forward calls,
providing information, taking messages, or scheduling appointments.
Greet persons entering establishment, determine nature and purpose of
visit, and direct or escort them to specific destinations.
Transmit information or documents to customers, using computer, mail,
or facsimile machine.
Hear and resolve complaints from customers or the public.
Perform administrative support tasks, such as proofreading, transcribing
handwritten information, or operating calculators or computers to work
with pay records, invoices, balance sheets, or other documents.
File and maintain records.
Provi de information about establishment, such as location of departments
or offices, employees within the organization, or services provi ded.
Collect, sort, distribute, or prepare mail, messages, or courier deliveries.
Process and prepare memos, correspondence, travel vouchers, or other
documents.
Receive payment and record receipts for services.
Resident Services Director
Answer inquiries and provide information to the general public, customers,
visitors, and other interested parties regarding activities conducted at
establishment and location of departments, offices, and employees within the
organization.
Tasks
 Operate telephone switchboard to answer, screen, or forward calls,
providing information, taking messages, or scheduling appoi ntments.
 Greet persons entering establishment, determine nature and purpose of
visit, and direct or escort them to specific destinations.
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

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


Transmit information or documents to customers, using computer, mail,
or facsimile machine.
Hear and resolve complaints from customers or the public.
Perform administrative support tasks, such as proofreading, transcribing
handwritten information, or operating calculators or computers to work
with pay records, invoices, balance sheets, or other documents.
File and maintain records.
Provi de information about establishment, such as location of departments
or offices, employees within the organization, or services provi ded.
Collect, sort, distribute, or prepare mail, messages, or courier deliveries.
Process and prepare memos, correspondence, travel vouchers, or other
documents.
Receive payment and record receipts for services.
Assisted Living Director
Assess patient health problems and needs, develop and implement nursing care
plans, and maintain medical records. Administer nursing care to ill, injured,
convalescent, or disabled patients. May advise patients on health maintenance
and disease prevention or provi de case management. Licensing or registration
required.
Tasks
 Monitor, record, and report symptoms or changes in pa tients' conditions.
 Maintain accurate, detailed reports and records.
 Record patients' medical information and vital signs.
 Order, interpret, and evaluate diagnostic tests to identify and assess
patient's condition.
 Modify patient treatment plans as indicated by patients' responses and
conditions.
 Direct or supervise less-skilled nursing or healthcare personnel or
supervise a particular unit.
 Consult and coordinate with healthcare team members to assess, plan,
implement, or evaluate patient care plans.
 Monitor all aspects of patient care, including diet and physical activity.
 Instruct indi viduals, families, or other groups on topics such as health
education, disease prevention, or childbirth and develop health
improvement programs.
 Prepare patients for and assist with examinations or treatments.
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Memory Care Director
Assess patient health problems and needs, develop and implement nursing care
plans, and maintain medical records. Administer nursing care to ill, injured,
convalescent, or disabled patients. Ma y advise patients on health maintenance
and disease prevention or provi de case management. Licensing or registration
required.
Tasks










Monitor, record, and report symptoms or changes in patients' conditions.
Maintain accurate, detailed reports and records.
Record patients' medical information and vital signs.
Order, interpret, and evaluate diagnostic tests to identify and assess
patient's condition.
Modify patient treatment plans as indicated by patients' responses and
conditions.
Direct or supervise less-skilled nursing or healthcare personnel or
supervise a particular unit.
Consult and coordinate with healthcare team members to assess, plan,
implement, or evaluate patient care plans.
Monitor all aspects of patient care, including diet and physical activity.
Instruct indi viduals, families, or other groups on topics such as health
education, disease prevention, or childbirth and develop health
improvement programs.
Prepare patients for and assist with examinations or treatments.
Care Givers, Memory Care
Assist mentally impaired or emotionally disturbed patients, working under
direction of nursing and medical staff. May assist with daily living activities,
lead patients in educational and recreational activities, or accompany patients to
and from examinations and treatments. May restrain violent patients. Includes
psychiatric orderlies.
Tasks
 Complete physical checks and monitor patients to detect unusual or
harmful behavior and report observations to professional staff.
 Record and maintain patient informati on, such as vital signs, eating
habits, behavior, progress notes, treatments, or discharge plans.
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

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



Maintain patients' restrictions to assigned areas.
Work as part of a team that may include psychiatrists, psychologists,
psychiatric nurses, or social workers .
Provi de patients with assistance in bathing, dressing, or grooming,
demonstrating these skills as necessary.
Clean and disinfect rooms to maintain a safe and orderly environment.
Restrain or aid patients as necessary to prevent injury.
Provi de mentally impaired or emotionally disturbed patients with routine
physical, emotional, psychological, or rehabilitation care under the
direction of nursing or medical staff.
Serve meals or feed patients needing assistance or persuasion.
Organize, supervise, or encourage patient participation in social,
educational, or recreational activities.
Assisted Living Care Givers
Assist the elderly, convalescents, or persons with disabilities with daily living
activities at the person's home or in a care facility. Duties perf ormed at a place
of residence may include keeping house (making beds, doing laundry, washing
dishes) and preparing meals. May provide assistance at non-residential care
facilities. May advise families, the elderly, convalescents, and persons with
disabilities regarding such things as nutrition, cleanliness, and household
activities.
Tasks
 Administer bedside or personal care such as ambulation or personal
hygiene assistance.
 Prepare and maintain records of client progress and services performed,
reporting changes in client condition to manager or supervisor.
 Perform housekeeping duties, such as cooking, cleaning, washing clothes
or dishes, or running errands.
 Care for indi viduals or families during periods of incapacitation, family
disruption, or convalescence, provi ding companionship, personal care, or
help in adjusting to new lifestyles.
 Perform healthcare-related tasks, such as monitoring vital signs and
medication, under the direction of registered nurses or physiotherapists.
 Transport clients to locations outside the home, such as to physicians'
offices or on outings, using a motor vehicle.
 Instruct or advise clients on issues such as household cleanliness, utilities,
hygiene, nutrition, or infant care.
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

Participate in case reviews, consulting with the tea m caring for the client,
to evaluate the client's needs and plan for continuing services.
Train family members to provi de bedside care.
Dining Services Director
Plan, direct, or coordinate activities of an organization or department that
serves food and beverages.
Tasks
 Monitor compliance with health and fire regulations regarding food
preparation and serving, and building maintenance in lodging and dining
facilities.
 Monitor food preparation methods, portion sizes, and garnishing and
presentation of food to ensure that food is prepared and presented in an
acceptable manner.
 Count money and make bank deposits.
 Investigate and resolve complaints regarding food quality, service, or
accommodations.
 Coordinate assignments of cooking personnel to ensure econom ical use of
food and timely preparation.
 Schedule and receive food and beverage deliveries, checking delivery
contents to verify product quality and quantity.
 Monitor budgets and payroll records, and review financial transactions to
ensure that expenditures are authorized and budgeted.
 Maintain food and equi pment inventories, and keep inventory records.
 Schedule staff hours and assign duties.
 Establish standards for personnel performance and customer service.
Cooks
Prepare and cook large quantities of foo d for institutions, such as schools,
hospitals, or cafeterias.
Tasks
 Clean, cut, and cook meat, fish, or poultry.
 Cook foodstuffs according to menus, special dietary or nutritional
restrictions, or numbers of portions to be served.
 Clean and inspect galley equipment, kitchen appliances, and work areas
to ensure cleanliness and functional operation.
 Apportion and serve food to facility residents, employees, or patrons.
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
Direct activities of one or more workers who assist in preparing and
serving meals.
Wash pots, pans, dishes, utensils, and other cooking equipment.
Compile and maintain records of food use and expenditures.
Take inventory of supplies and equipment.
Bake breads, rolls, and other pastries.
Train new employees.
Servers/Aides
Serve food to indi viduals outside of a restaurant environment, such as in hotel
rooms, hospital rooms, residential care facilities, or cars.
Tasks
 Monitor food distribution, ensuring that meals are delivered to the correct
recipients and that gui delines, such as those for special diets, are
followed.
 Clean or sterilize dishes, kitchen utensils, equipment, or facilities.
 Examine trays to ensure that they contain required items.
 Place food servings on plates or trays according to orders or instructions.
 Load trays with accessories such as eating utensils, napkins, or
condiments.
 Take food orders and relay orders to kitchens or serving counters so they
can be filled.
 Stock service stations with items such as ice, napkins, or straws.
 Remove trays and stack dishes for return to ki tchen after meals are
finished.
 Prepare food items, such as sandwiches, salads, soups, or beverages.
 Monitor food preparation or serving techniques to ensure that proper
procedures are followed.
Activities Director
Answer inquiries and provide informatio n to the general public, customers,
visitors, and other interested parties regarding activities conducted at
establishment and location of departments, offices, and employees within the
organization.
Tasks
 Operate telephone switchboard to answer, screen, or forward calls,
providing information, taking messages, or scheduling appointments.
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








Greet persons entering establishment, determine nature and purpose of
visit, and direct or escort them to specific destinations.
Transmit information or documents to customers, using computer, mail,
or facsimile machine.
Hear and resolve complaints from customers or the public.
Perform administrative support tasks, such as proofreading, transcribing
handwritten information, or operating calculators or computers to work
with pay records, invoices, balance sheets, or other documents.
File and maintain records.
Provi de information about establishment, such as location of departments
or offices, employees within the organization, or services provi ded.
Collect, sort, distribute, or prepare mail, messages, or courier deliveries.
Process and prepare memos, correspondence, travel vouchers, or other
documents.
Receive payment and record receipts for services.
Memory Care Activities
Conduct recreation activities with groups in public, private, or vol unteer
agencies or recreation facilities. Organize and promote activities, such as arts
and crafts, sports, games, music, dramatics, social recreation, camping, and
hobbies, taking into account the needs and interests of indi vi dual member s.
Tasks
 Enforce rules and regulations of recreational facilities to maintain
discipline and ensure safety.
 Manage the daily operations of recreational facilities.
 Administer first aid according to prescribed procedures, and notify
emergency medical personnel when necessary.
 Organize, lead, and promote interest in recreational activities such as arts,
crafts, sports, games, camping, and hobbies.
 Greet new arrivals to activities, introducing them to other participants,
explaining facility rules, and encoura ging participation.
 Supervise and coordinate the work activities of personnel, such as
training staff members and assigning work duties.
 Confer with management to discuss and resolve participant complaints.
 Explain principles, techniques, and safety procedures to participants in
recreational activities, and demonstrate use of materials and equipment.
 Complete and maintain time and attendance forms and inventory lists.
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
Evaluate recreation areas, facilities, and services to determine if they are
producing desired results.
Assisted Living Activities
Conduct recreation activities with groups in public, private, or vol unteer
agencies or recreation facilities. Organize and promote activities, such as arts
and crafts, sports, games, music, dramatics, social recreation, camping, and
hobbies, taking into account the needs and interests of indi vi dual members.
Tasks
 Enforce rules and regulations of recreational facilities to maintain
discipline and ensure safety.
 Manage the daily operations of recreational facilities .
 Administer first aid according to prescribed procedures, and notify
emergency medical personnel when necessary.
 Organize, lead, and promote interest in recreational activities such as arts,
crafts, sports, games, camping, and hobbies.
 Greet new arrivals to activities, introducing them to other participants,
explaining facility rules, and encouraging participation.
 Supervise and coordinate the work activities of personnel, such as
training staff members and assigning work duties.
 Confer with management to discuss and resolve participant complaints.
 Explain principles, techniques, and safety procedures to participants in
recreational activities, and demonstrate use of materials and equipment.
 Complete and maintain time and attendance forms and inventory list s.
 Evaluate recreation areas, facilities, and services to determine if they are
producing desired results.
Maintenance Director
Directly supervise and coordinate work activities of cleaning personnel in
hotels, hospitals, offices, and other establishment s.
Tasks




Plan and prepare employee work schedules.
Coordinate activities with other departments to ensure that services are
provided in an efficient and timely manner.
Inspect work performed to ensure that it meets specifications and
established standards.
Resolve performance and personnel problems.
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



Establish and implement operational standards and procedures for the
departments supervised.
Investigate complaints about service and equi pment, and take corrective
action.
Maintain required records of work hours, budgets, payrolls, and other
information.
Inspect and evaluate the physical condition of facilities to determine the
type of work required.
Van Drivers
Transport residents or special clients, such as the elderly or persons with
disabilities. Ensure adherence to safety rules.
Tasks
 Follow safety rules as residents board and exit buses or cross streets near
bus stops.
 Comply with traffic regulations to operate vehicles in a safe and
courteous manner.
 Maintain order among pupils during trips to ensure safety.
 Check the condition of a vehicle's tires, brakes, windshield wipers, lights,
oil, fuel, water, and safety equipment to ensure that everything is in
working order.
 Escort small children across roads and highways.
 Report any bus malfunctions or needed repairs.
 Pick up and drop off residents at regularly scheduled neighborhood
locations, following strict time schedules.
 Maintain knowledge of first-aid procedures.
 Prepare and submit reports that may include the number of passengers or
trips, hours worked, mileage, fuel consumption, or fares received.
Housekeepers
Perform any combination of light cleaning duties to maintain pri vate
households or commercial establishments, such as hotels and hospitals, in a
clean and orderly manner. Duties may include m aking beds, replenishing linens,
cleaning rooms and halls, and vacuuming.
Tasks
 Carry linens, towels, toilet items, and cleaning supplies, using wheeled
carts.
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
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Disinfect equipment and supplies, using germicides or sterilizers.
Clean rooms, hallways, lobbi es, lounges, restrooms, corridors, elevators,
stairways, and other work areas so health standards are met.
Empty wastebaskets, empty and clean ashtrays, and transport other trash
and waste to disposal areas.
Observe precautions required to protect hotel and guest property and
report damage, theft, and found articles to supervisors.
Replenish supplies, such as drinking glasses, linens, writing supplies, and
bathroom items.
Clean rugs, carpets, upholstered furniture, and draperies, using vacuum
cleaners and shampooers.
Dust and polish furniture and equi pment.
Keep storage areas and carts well-stocked, clean, and ti dy.
Wash windows, walls, ceilings, and woodwork, waxing and polishing as
necessary.
Laundry
Operate or tend washing or dry-cleaning machines to wash or dry-clean facility
articles such as cloth garments, blankets, draperies, linens, rugs, and carpets.
Tasks
 Receive and mark articles for laundry or dry cleaning with identifying
code numbers or names, using hand or machine markers.
 Start washers, dry cleaners, driers, or extractors, and turn valves or levers
to regulate machine processes and the vol ume of soap, detergent, water,
bleach, starch, and other additives.
 Sort and count articles removed from dryers, and fold, wrap, or hang
them.
 Examine and sort into lots articles to be cleaned, according to color, fabric,
dirt content, and cleaning technique required.
 Load articles into washers or dry-cleaning machines, or direct other
workers to perform loading.
 Mix and add detergents, dyes, bleaches, starches, and other solutions and
chemicals to clean, color, dry, or stiffen articles.
 Clean machine filters, and l ubricate equipment.
 Remove items from washers or dry-cleaning machines.
 Operate extractors and driers, or direct their operation.
 Inspect soiled articles to determine sources of stains, to locate color
imperfections, and to i dentify items requiring special treatment.
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7.0 E-Verify
The Company will participate in E-Verify to document both the legality of its
employees and the number that are hired.
E-Verify is an electronic program through
which employers verify the employment
eligibility of their employees after
hire. The program was authorized by the
Illegal
Immigration
Reform
and
Immigrant Responsibility Act of 1996
(IIRIRA). In short, employers submit
information taken from a new hire's Form
I-9 (Employment Eligibility Verification
Form) through E-Verify to the Social
Security Administration and United
States Citizenship and Immigration
Services (USCIS) to determine whether
the information matches government
records and whether the new hire is
authorized to work in the United States.
E-Verify is administered by the United
States Department of Homeland Security,
USCIS, Verification Division, and the
Social Security Administration.
The
USCIS Verification Division is dedicated
to
providing
program
support,
administering
unparalleled
customer
service to both employers and workers,
developing
innovative
technological
solutions, and performing community
outreach to further the mission of EVerify.
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Austin, Texa s
8.0 Employment and Economic Impacts
With planned development over a period of years, this project will have a very
significant impact on the Austin region.
The econometric analysis has
calculated the permanent increase in employment, output, and la bor income and
indirect business taxes. The number of permanent new jobs created consists of
the following components:


Direct new jobs for the construction and operation of the Sunset Arms
Assisted Living Facility, LLC
Indirect and induced jobs from the construction and operation of the
Sunset Arms Assisted Living Facility, LLC, as calculated with the
IMPLAN model, using multipliers for Travis, Williamson, Hays, Bastrop
and Caldwell Counties, Texas.
8.1 Assumptions
The following assumptions were used as the basis for the IMPLAN projections:
 Employee numbers were based on client-provided data that was validated
based on industry and local market standards, specifically those for
Austin, Texas.

Projected revenue and expense figures were based on client-provi ded data
and validated based on industry and local market standards, specifically
those for Austin, Texas.

The multipliers used were those for Travis, Williamson, Hays, Bastrop
and Caldwell Counties, Texas.
Specifically:
Construction



The inputs used for construction reflected the hard costs provided by the
client and di d not include the soft costs in accordance with USCIS
requirements.
The inputs used for construction did not include any real estate purchases
in accordance with USCIS requirements .
The number of direct, indirect and induced construction jobs was derived
from client-provided jobs input and the hard-cost investment in the
project and were not solely a derivative of inputting the project hard cost
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
inputs into the IMPLAN system.
Resulting outputs such as value-added are a direct reflection of combining
these two inputs in this way as opposed to relying on the automatically
generated IMPLAN results.
8.2 Projected Economic Impacts
8.2.1 Projected Economic Impacts for Entire Project
Impact Type
Employmen t
Labor Income
Valu e Added
Ou tpu t
Direct Effect
Indirect Effect
58.2
20.2
$9,577,777
$2,244,355
$23,254,374
$4,058,110
$48,164,598
$6,751,795
Induced Effect
Total Effect
31.6
110
$2,342,875
$14,165,006
$4,836,188
$32,148,672
$7,752,740
$62,669,132
8.2.2 Construction Jobs Overview Phases I and II
The construction of the various components of this project will be spread over a
six-year span, as shown in the project timeline. The current plan enables the
project to begin accruing revenue in year three while continuing to invest
money into the project.
8.2.2.1 Total Construction Jobs Anticipated from Project
Impact Type
Employmen t
Labor Income
Valu e Added
Ou tpu t
Direct Effect
Indirect Effect
58.2
20.2
$9,577,777
$2,244,355
$23,254,374
$4,058,110
$48,164,598
$6,751,795
Induced Effect
Total Effect
31.6
110
$2,342,875
$14,165,006
$4,836,188
$32,148,672
$7,752,740
$62,669,132
8.2.2.2 Total Impacts from Assisted Living Operations Years One and Two
Impact Type
Employmen t
Labor Income
Valu e Added
Ou tpu t
Direct Effect
Indirect Effect
58.2
20.2
$9,577,777
$2,244,355
$23,254,374
$4,058,110
$48,164,598
$6,751,795
Induced Effect
Total Effect
31.6
110
$2,342,875
$14,165,006
$4,836,188
$32,148,672
$7,752,740
$62,669,132
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9.0 Central Texas Economic Development
In line with the goals of the region’s economic development strategy, the
industry clusters that they have been made priorities and in order to participate
in the revitalization of the region, the Company will develop this Project.
A paradigm shift in the way many fam ilies live has slowly altered the face of the
American way of life over the last hundred years. The Com pany will take advantage of
the opportunity to participate in this change.
Long-since abandoned are the traditional living arrangements where families
lived together or even in the same neighborhood or city. Undeniably, economic
changes have fostered some of this change but there are new sets of rules being
evolved for communities. After a decades -long hiatus where community was an
oft-forgotten concept, those of like mind who want to live together and want to
live with others whose vision of the community is the same are now forging new
communities. These communities include today’s assisted living communities .
9.1 Central Texas Four-Region Demographics and Economy
The Central Texas countryside is characterized by two major geographic areas.
On its eastern side, rolling prairies extend from Hillsboro south to Brenham.
Traveling westward, slopes and cedars appear more frequently on the upper rim
of the Texas Hill Country. This diverse landscape provi des an array of resources
that fuel regional industries and foster economic growth.
The macroeconomic view of this area is considered here because it provides the
context for this regional center’s operation.
Manufacturing plays a pivotal role in the area’s econom y. Area businesses manufacture
a broad range of products including lim e, plastics, desserts and soft drinks.
Mining is a traditional pillar of the regional econo my. Enterprises such as clay,
ceramic and refractory mining have remained robust, while value -added
activities such as wholesaling and transportation have evol ved to support them.
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Since the 1940s, the military has played a large role in the Central Texas
economy. Fort Hood, in the Killeen area, has trained and deployed soldiers for
military conflicts since World War II. The base’s presence supports local
communities and businesses while bringing in jobs from outside the state.
Manufacturing plays a pivotal role in the area’s economy. Area businesses
manufacture a broad range of products including lime, plastics, desserts and
soft drinks.
The region has experienced job growth similar to the state’s growth, and should
follow state trends through 2013. The employment growth rate in Central Texas
shoul d outpace Texas growth in 2009, with a projected decrease in Texas of less
than one percent, while Central Texas is projected to grow less than one percent.
Industry Employment Projections, Central Texas Regio n, 2003-2013
S ource
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Growth in the Bryan-College Station metro area should exceed the Texas growth
rate in 2010 and continue outpacing the state through 2013. Non -metro counties
in Central Texas are projected to lose jobs in 201 0, followed by projected job
gains through 2013.
Economic Trends
Of the projections by period’s end, three supersectors show steady expansion
throughout the period. The Professional and Business Services sector should top
all supersector growth with 36 percent more jobs in 2013 than 2003. The sector is
projected to add jobs each year to finish with 33,239 in 2013, led by Financial
Support Services projected to add 1,589 jobs over the period. Engineering
Services should lead all industries in the sector wit h 2,839 jobs in 2013.
Leisure and Hospitality is another supersector projected to add jobs each year, growing
32 percent from 2003 to 2013 to finish the period with 43,249 jobs. Most of this growth
is attributable to its leading job industry, Lim ited Serv ice Restaurants, which is
projected to add 5,644 jobs by 2013.
The third supersector projected to add jobs each year is Education and Health
Services. General Medical and Surgical Hospitals lead all industries in jobs and
job growth throughout the period, projected to add 42 percent of supersector
jobs by 2013 to finish with 17,658. Home Health Care Services should finish as
the second largest industry with 7,526 jobs projected in 2013. Educational
industries as a group are projected to grow more modestly, led by Colleges,
Uni versities and Professional Schools contributing four percent of supersector
job growth by 2013.
Despite various industry downturns, other supersectors show strong projected
job growth. At almost 32 percent, projected growth in the Agr iculture, Natural
Resources and Mining sector trails only growth in Professional and Business
Services. This comes after strong rebounds from contractions in 2004 and 2006,
and growth projected through the 2009 national recession.
Overall, jobs in the Central Texas econom y are expected to grow by 21 percent between
2003 and 2013.
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Oil and Gas Support Activities should lead all supersector industries,
contributing 72 percent job growth by 2013. Dimension Stone Mining and
Quarrying should see large percentage gains, projected to finish with 280 jobs in
2013 from a start of only 11 jobs in 2003.
Government represents the largest regional supersector with 170,074 projected
jobs in 2013. Government jobs shoul d increase by 20 percent from 2003 to 2013,
led by a projected job gain of 9,682 in State Government.
Local Government accounts for more employment than any industry in the
region with 60,222 jobs projected in 2013. Most of these Local Government jobs
are in public schools. Except for a slight contraction in 2004, the supersector is
projected to add jobs in each year of the 10 -year period.
Other supersectors anticipating positive job growth rates over the period
include Construction (22 percent); Trade, Transportation and Utilities (17
percent); Financial Activities (17 percent); Other Services (14 percent);
Information (13 percent); and Manufacturing (eight percent).
Economic Structure
Job growth depends upon a region’s underlying economic structure. That
structure includes multiple factors, including nat ural resources, labor force
characteristics and the composition and concentration of the region’s industries.
This latter characteristic, also called clustering, is particularly important since
industry clusters give firms within them access to more suppli ers and to skilled
laborers with valuable knowledge and information. The benefits that result from
high industry concentrations give a region its competitive edge.
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10.0 Austin-Red Rock MSA
The demographics for this population are important because it i s from this
source that the project will derive its employee base.
Population
2000 Population
1,233,226
2010 Population
1,694,835
2012 Population
1,781,486
2017 Population
2,028,376
2000-2010 Annual Rate
3.23%
2010-2012 Annual Rate
2.24%
2012-2017 Annual Rate
2.63%
2012 Male Population
50.2%
2012 Female Population
49.8%
2012 Median Age
32.7
In the identified area, the current year population is 1,781,486. In 2010, the
Census count in the area was 1,694,835. The rate of change since 2010 was 2.24%
annually. The five-year projection for the population in the area is 2,028,376
representing a change of 2.63% annually from 2012 to 2017. Currently, the
population is 50.2% male and 49.8% female.
Households by Income
Current median househol d income is $57,397 in the area, compared to $50,157
for all United States househol ds. Median household income is projected to be
$64,537 in five years, compared to $56,895 for all United States households
Current average household income is $79,400 in this area, compared to $68,162
for all U.S households. Average household income is projected to be $89,332 in
five years, compared to $77,137 for all United States households. Current per
capita income is $30,878 in the area, compared to the United States per capita
income of $26,409. The per capita income is projected to be $34,649 in five years,
compared to $29,882 for all United States households.
Median Household Income
2012 Median Household Income
$57,397
2017 Median Household Income
$64,537
2012-2017 Annual Rate
2.37%
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Average Household Incom e
2012 Median Household Income
$79,400
2017 Median Household Income
$89,332
2.39%
2012-2017 Annual Rate
Housing
490,954
2000 Total Housing Units
2000 Owner Occupied Hous ing Units
271,670
2000 Owner Occupied Hous ing Units
195,032
24,252
2000 Vacant Housing Units
700,245
2010 Total Housing Units
2010 Owner Occupied Hous ing Units
376,697
2010 Renter Occupied Housing Units
267,612
2010 Vacant Housing Units
55,936
732,133
2012 Total Housing Units
2012 Owner Oc cupied Hous ing Units
389,061
2012 Renter Occupied Housing Units
287,867
55,205
2012 Vacant Housing Units
826,048
2017 Total Housing Units
2017 Owner Occupied Hous ing Units
452,413
2017 Renter Occupied Housing Units
319,745
53,890
2015 Vacant Housing Units
Currently, 53.1% of the 732,133 housing units in the area are owner occupied;
39.3%, renter occupied; and 7.5% are vacant. Currently, in the United States,
56.5% of the housing units in the area are owner occupied; 32.1% are renter
occupied; and 11.4% are vacant. In 2010, there were 700,245 housing units in the
area - 53.8% owner occupied, 38.2% renter occupied, and 8.0% vacant. The
annual rate of change in housing units since 2010 is 2.00%. Median home value
in the area is $192,911, compared to a median home value of $167,749 for the
United States. In fi ve years median value is projected to change by 1.07%
annually to $203,505.
Unemployment
The following chart shows a comparison of the unemployment trend for the
State of Texas over the past decade. Southwest Business Services created this
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chart based upon BLS data. As the chart clearly indicate s, after decreasing
between 2006 and 2008, the unemployment rate has spiked sharply since then.
The unemployment rate in the county is a major driver for projects such as this
one.
Job Creation and Job Flows 2011
Austin Quarter
Four
Austin (Average: Selected
plus Three Prior Quarters
Texas Quarter
Four
Texas (Average: Selected
plus Three Prior Quarters
808,020
805,562
10,338,472
10,203,041
Net Job Flows
-2,775
3,790
-86,415
58,757
Job Creation
35,070
34,690
470,768
478,437
New Hires
105,825
109,259
1,561,777
1,606,104
Separations
124,825
119,052
1,889,695
1,744,279
9.00%
8.40%
10.10%
9.20%
Average Monthly Earnings
$4,639.00
$4,445.75
$4,362.00
$4,239.25
Average New Hire Earnings
$2,835.00
$2,779.00
$2,777.00
$2,715.00
Category
Total Employment
Turnover
The chart above and the one below show the number of new hires, separations
and turnover in August MSA and Texas as a whole. The one below reflects
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information for the accommodation and food services industry.
This
information is of critical importance when evaluating the existence of a
workforce adequate to staff the planned facility.
Job Creation and Job Flows for Health Care and Social Assistances 2011
Austin Quarter
Four
Austin (Average: Selected
plus Three Prior Quarters
Texas
Quarter Four
Texas (Average: Selected
plus Three Prior Quarters
89,674
88,218
1,376,805
1,362,818
Net Job Flows
-807
598
-21,485
4,737
Job Creation
2,996
3,081
41,346
45,722
New Hires
10,205
10,618
168,095
177.237
Separations
11,856
10,904
207,417
190,003
Turnover
9.10%
8.10%
9.9%
8.9%
Average Monthly Earnings
$4,483.00
$4,128.25
$3,846.00
$3,706.25
Average New Hire Earnings
$2,865.00
$2,643.75
$2,484.00
$2,410.25
Category
Total Employment
What the tables indicate for the Austin MSA overall job creation scenario and
job creation scenario in the health care and social assistance industry, in
particular, is the following:




For the most recent year in which data is available, 2011, separations were
greater than new hires in the Austin MSA in all industry sectors
For the most recent year in which data is available, 2011, turnover at year
end was greater than the average of the three prior quarters in all
industry sectors
For the most recent year in which data is available, 2011, separations were
greater than new hires in the Austin MSA in the health care and social
assistance
For the most recent year in which data is available, 2011, turnover in the
health care and social assistance sector was almost double the rate in all
other industry sectors in the Austin MSA
Each of these conclusions indicates that an employable workforce exists in this
sector.
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11.0 Target Market Analysis
Fifty-five million people in the United States are over 55 years of age and 34 m illion are
over 65 years old, a not inconsequential figure and one that figure will double by 2030.
It is likewise a market oft-ignored that is a potential goldm ine. In North America,
sixty-eight percent of all high net-worth individuals are over fifty -five, a lucrative
market to be sure.
Today, approximately one million Americans live in an estimated 39 ,000
assisted living communities across the country. An integral part of the care
continuum, assisted living is a dynamic form of residential care, serving
primarily elderly people and indi viduals with disabilities. Assisted living was
created in response to consumer demand for person-centered care. Assisted
living residences provi de assistance with phys ical activities and health-related
needs. Assisted living staffs embrace a philosophy of care that meets the social,
emotional, cultural, intellectual, and spiritual well-being of residents in a
manner that maximizes resident independence and respects resident choice,
dignity, and privacy.
While it seems like a dichotomy, today’s retirement community residents want
to retain their mobility and independence of spirit for as long as possible but
with the assurance that as they require more assi stance it will be available. .
Austin Target Market Current and Projected Population
Age Range
2010
Total Population
T otal(50+)
50-54
55-59
60-64
65-69
70-74
75-79
80-84
85+
65+
75+
2015
Number
32,257
6,509
5,878
4,901
3,641
2,988
2,758
2,550
3,032
% of Total Population
26.7%
5.4%
4.9%
4.1%
3.0%
2.5%
2.3%
2.1%
2.5%
Number
34,546
6,347
6,221
5,749
4,847
3,426
2,736
2,184
3,036
% of Total Population
28.1%
5.2%
5.1%
4.7%
3.9%
2.8%
2.2%
1.8%
2.5%
14,969
8,340
12.4%
6.9%
16,229
7,956
13.2%
6.5%
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Demographically, Austin MSA mirrors the trends of the rest of the nation as far
as being home to an exponentially increasing number of residents between the
ages of 55 and 75. The market base does exist to absorb this facility.
Austin Over 55 Households by Income 2010
2010 Households by Income and Age of Householder 55+
55-64
65-74
75+
Total
6,238
4,015
4,969
15,22
<$15,000
957
849
1,424
3,230
$15,000-$24,999
854
590
952
2,396
$25,000-$34,999
760
510
600
1,870
$35,000-$49,999
1,114
686
752
2,552
$50,000-$74,999
1,136
665
598
2,399
$75,000-$99,999
604
310
302
1,216
$100,000-$149,999
573
231
248
1,052
$150,000-$199,999
155
39
40
234
85
135
53
273
Median Household Income
$41,050
$35,900
$26,404
$35,470
Average Household Income
$54,971
$51,848
$40,054
$49,278
Total
$200,000+
Austin Over 55 Household by Income 2015
2015 Households by Income and Age of Householder 55+
Total
55-64
65-74
75+
6,883
5,011
4,722
Total
16,616
<$15,000
903
900
1,205
3,008
$15,000-$24,999
849
633
797
2,279
$25,000-$34,999
712
521
475
1,708
$35,000-$49,999
1,164
848
738
2,750
$50,000-$74,999
1,550
1,068
821
3,439
$75,000-$99,999
650
431
307
1,388
$100,000-$149,999
709
347
273
1,329
$150,000-$199,999
214
72
52
338
$200,000+
132
191
54
377
Median Household Income
$46,853
$41,688
$32,041
$40,887
Average Household Income
$60,316
$57,697
$44,387
$55,00
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12.0 Demand Determinants
COMMERCIAL BUILDING CONSTRUCTION DEMAND
The key factors that influence demand for commercial building constructi on
vary according to the type of building (i.e. hotels, retail stores and offices).
However, overall industry activity is determined by current economic
conditions and investor confidence. Key economic factors that influence
investment decisions include the prevailing interest rate and availability of
finance; current and expected rates of general economic growth; the expected
investment yield (long-term rental yield and spec ulative capital gains); taxation
treatment of building investment compared with other types of assets; vacancy
rates of existing building stock; the rate of replacing aging building stock; and
changes in the structure, distribution and population's size. The industry is also
subject to one-off stimuli to building demand resulting from the impact of
natural disasters, such as the damage caused by tropical storms, hurricanes and
earthquakes.
Office construction is principally determined by growth in the service sector
work force, growth in foreign investment inflow and developer spec ulative
activity. The average age of commercial office stock is an important determinant
of demand for the addition of new stock or the upgrade of existing stock. New
technologies in the areas of IT and communications have negatively influenced
rapidly aging building stock, thereby increasing demand for premium stock.
Retail building construction (e.g. retail stores, shopping malls, gas stations) is
principally determined by shopping preference and patterns (i.e. choices
between boutiques and complexes); population growth rates and catchment
areas; and patterns in consumption expenditure. Hotel construction is
determined by growth in international and domestic tourism; major cultural,
sporting, entertainment and business events; growth in casino licenses; and
existing supply of accommodation. Other commercial building construction is
determined by population growth and urban spread; increases in tourism and
leisure time; major cultural and sporting events (i.e. Winter Olympics); and
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popularity of new sports and recreational activities (i.e. soccer and beach
volleyball).
Demand Determ inants
The homeownership rate in the United States is the overarching determinant of
industry demand. When homeownership is high, rental demand tends to
decline. Homeownership levels a re generally influenced by the health of the
housing market (i.e. housing prices), mortgage rates, unemployment rates, along
with local market population demographics and general economic trends.
Local Demographics and Population Trends
US demographics are strong determinants industry demand, because
homeownership is largely affected by marriage rates, divorce trends and family
sizes. Marriage and di vorce rates affect demand because couples tend to own
homes at higher rates due to higher disposable incomes . Family sizes are also
important because homeownership tends to increase as the demand for space
rises, often due to family expansion from the birth of children.
Population trends are also important factors in the demand for homeownership.
Generally, densely populated urban areas have lower homeownership rates than
suburban and rural locations. These metropolitan areas are characterized by
homeownership costs that are significantly higher than the national average,
and thus renting is a more financial via ble option. Industry demand tends to be
high in such markers. At the same time, it is important for industry participants
to invest in property in areas of strong population growth. Economic activity is
the main determinant of population distribution withi n the United States,
because indivi duals tend to work and live in areas with strong business activity
and employment prospects. Therefore an expansion of an area's business
activity--via a large company opening a new office in a market, for instance-often results in heightened demand for rental property.
Housing Market Trends
The health of the housing sector is an important determinant of rental industry
growth. During times of low interest rates and strong property appreciation,
homeownership levels tend to rise. This was particularly evident during the real
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estate bubble that occurred prior to the subprime mortgage crisis, when
homebuyers were able to buy property by borrowing large sums, and then
watch the value of their homes appreciate. Since the bubb le burst in late 2007,
however, credit has become much harder to obtain, and home prices have
pl ummeted due to a vast oversupply. These two factors have rendered
homeownership a much less popular and viable option for many Americans —a
downturn that has been good news for the apartment rental industry.
Economic Cycles
Industry demand is strongly affected by general economic cycles. During times
of strong economic growth, indi viduals tend to spend more money on living
expenses. However, strong economic growth may also lead to a rise in
homeownership levels, which can adversely affect industry demand.
Consequently, economic growth can be a double -edged sword for property
lessors.
The most important indicator for industry demand in regards to economic cycles
is the unemployment rate. During times of high unemployment, people tend to
cut living expenses by moving in with relatives or friends, or moving to units
with lower monthly rents. Job growth often varies across regions within the
United States, and the health of the local employment market has a greater
direct effect on home ownership rates in a given market. However, the national
unemployment rate is also an important barometer for determining consumer
sentiment due to the influence of national news outlet s on the perception of job
security. If indi viduals believe there is a lack of job security, they may cut back
on living expenses in an attempt to prepare for the possibility of losing their
jobs.
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13.0 Market Analysis
This project, introduced into the Austin assisted living industry arena, will be
influenced by regional market trends and national ones .
13.1 Austin Assisted Living Market Potential
Projected Industry Growth in Austin MSA, Texas and the US to 2016
Year
2012
2013
2014
2015
2016
Austin MSA
$329,299,776
$352,350,760
$377,015,314
$403,406,385
$329,299,776
Texas
$1,537,580,000
$1,585,250,000
$1,675,600,000
$1,757,710,000
$1,880,870,000
United States
$51,252,600,000
$52,841,500,000
$55,853,400,000
$58,590,200,000
$62,695,500,000
S ource
The numbers for the local industry indicate that the Company will not be
entering a saturated market and the opportunity to establish a niche foothold in
this market exists now.
Texas Assisted Living Rental Rates Compared to Remainder of Country
Region
USA
Minimum
Rate Range
Median
Maximum
Median Annual
Rate
Five-Year
Annual Growth
$625
$3,300
$9,750
$39,600
6%
Texas – Whole State
$2,150
$3,750
$6,500
$45,000
13%
Austin MSA
$2,150
$3,815
$6,500
$45,774
14%
S ource
Austin MSA
Aggregate
Independent Living
Assisted Living
Occupancy
93%
93%
92%
Year-Over-Year Rent Growth
14%
14%
14%
Property Count
105
20
85
S ource
Assisted Living Provisional Income Projections
Overall Occu pancy %
Total Revenues
2012
2013
2014
2015
54.0%
84.8%
84.8%
84.8%
$2,354,486
$3,817,793
$3,968,331
$4,187,248
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Au stin -Red Rock Revenue Projection s Per Establish men t
2012
T otal Revenues
T otal Establishments
Revenue Per Establishment
2013
$329,299,776
85
$3,874,115
2014
$352,350,760
87
$4,050,009
2015
$377,015,314
89
$4,236,127
$403,406,385
91
$4,433,037
S ource
When compared to the revenue projections for all Austin-Red Rock assisted
living facilities, it appears that those for the Sunset Arms are well aligned with
regional industry standards.
Austin Market Benchmarks
KEY INFLUENCERS
Metro
MAP32-1001
Projected Annual Growth2 (%)
3.10%
0.90%
45-64 Age Households Percent of all Households
63.90%
57.90%
Median Income
$67,917
$62,945
Projected Annual Growth2 (%)
3.70%
1.50%
75+ Age Households Percent of all Households
9.50%
14.50%
Median Income
$32,363
$27,706
Median Home Value
$188,300
$164,350 (Top 100)
0.60%
-3.0% (USA)
Annual Change In Individual Home Prices
Austin Senior Housing Market Metrics
Property Types
Majority Independent Living
Majority Assisted Living
Metro
MAP32-100
Metro
MAP32-100
Stabilized Occupancy
93.20%
90.40%
92.20%
90.60%
Average Monthly/Daily Rent
$3,523
$2,565
$3,764
$3,321
Median Age
15
22
13
15
Median Units/Beds Per Property
151
159
63
61
65.00%
64.10%
95.80%
88.00%
20
758
85
1,546
3,653
159,378
1,609
110,746
2,886
114,104
44
5,890
444
25,183
1,483
101,209
9.50%
6.70%
4.20%
4.70%
0
2,807
312
3,565
For Profit (%)
Property Count
Inventory
Independent Living Units
Assisted Living Units
1
Penetration
Construction Units/Beds
1. Includes Memory Care
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13.2 IBISWorld Industry Market Analysis for NAICS Code 623312
Industry Definition
This industry includes companies that primarily provide residential and
personal care services for the elderly and other indi viduals who are unable to
fully care for themselves or who desire to live in a community facility. The
industry excludes companies that predominantly provi de inpatient nursing,
skilled nursing or rehabilitative services.
Products and Services
The Assisted Li ving industry's principal activities are room and board; nursing
and other supervision; assistance in daily living and housekeeping services.
Chart: Product and services segmentation
Retirement and assisted living communities provi de a substantial range of
products, including independent living (IL), assisted living ( Assisted living),
skilled nursing (SN) and a combination of these, usually referred to as
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continuing care retirement communities (CCRC). Facilities that primarily
provide skilled nursing are not included in this industry. The US Census Bureau
classifies the segments as homes for the elderly and continuing care retirement
communities.
Market Share Concentration
Concentration in this industry is low. This industry is highly fragmented, with
the four largest operators accounting for around 15.0% of industry revenue.
Based on total resident capacity, the top five operators of senior living facilities
(including independent living facilities) control only nine percent of the market,
according to the American Seniors Housing Association.
Consolidation slowed during the recessionary years of 2008 and 2009, when
lending was difficult to secure from banks. However, banks and private equity
entities are beginning to view retirement homes and assisted living as a
desirable sector again, and the major REITs in senior housing are well positioned to invest again. However, many of the acquisitions made during the
coming years will likely remain with distressed properties, and high -end
properties are unlikely to be sold.
Some companies are focused on taking advantage of the fragmented industry.
For instance, Brookdale Senior Living was formed in 2005 for the purpose of
combining two senior living operating companies, Brookdale Living
Communities, Inc. and Alterra Healthca re Corporation. Brookdale acquired
American Retirement Corporation in 2006 to become the largest operator of
senior living facilities in the United States.
Brookdale plans to continue acquiring through selectively purchasing assets of
existing operating c ompanies of indi vi dual communities. In October 2009, the
company acquired 18 communities (or 1,197 units) from Sunrise Senior Living,
and in December 2009, the company acquired three previously managed
retirement center communities, totaling 642 units.
Revenue Volatility
The level of volatility is low. Industry revenue has a low level of volatility.
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During the five years to 2011, revenue growth fluctuated 1.8% per year on
average. The slow nature of changes in supply and demand cause fl uctuations in
revenue and profitability. When operators begin construction on new facilities,
it is difficult - if not impossible - to stall or stop the construction in response to
an economic downturn or dampened demand. Thus, oversupply occurs, which
reduces occupancy and profitability. Demand is also slow to change and thereby
challenging to notice and adapt to. Seniors might delay moving into a facility
due to a poor housing market. By the time operators perceive low demand, they
may already have plans for additional cons truction or they may not be able to
reduce supply quickly enough before demand recovers. Thus, in periods of
oversupply, operators are not able to adjust to lower occupancy and profitability
typically declines.
Occupancy can also be reduced by demographic factors that are specific to the
type of facility or the region. During certain periods of the year, facilities tend to
have multiple residents terminate their resident agreements at or around the
same time. For instance, in regions with strong climate fl uctuations, the winter
months of any gi ven year are difficult for occupancy because of higher deaths
among seniors in the winter and residents are less interested in moving over the
Christmas and New Year holidays. In addition, because of the demographics of
industry residents, including age and health, resident turnover rates in
communities are difficult to predict. As a result, units may be unoccupied for a
period of time, which could cause decreases to revenues and profit margin.
In contrast to these factors that increase volatility, the non- discretionary nature
of stays adds stability to industry earnings. A senior's move to an assisted living
facility is often a necessary move; that is, it is not a discretionary decision. As a
result, sales in assisted living and the continuing care segments are relatively
consistent from year to year. Consistent growth in the population of the aged
will benefit industry performance.
Inconsistent regulatory environment
Compliance with various regulations, which are cha ngeable, may result in
industry operators using resources, including cash, in order to meet
requirements. An intensified regulatory environment impacts providers because
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of the increase in the number of inspections or surveys by governmental
authorities and possible consequent citations for failure to comply with
regulatory requirements.
Operators spend considerable resources to respond to federal and state
investigations or other enforcement action. From time to time in the ordinary
course of business, c ompanies may receive deficiency reports from state and
federal regulatory bodies resulting from such inspections or surveys. Although
most inspection deficiencies are resolved through an agreed-to plan of
corrective action, the reviewing agency typically has the authority to take
further action against a licensed or certified facility, which could result in fines,
suspension or revocation of a license, suspension or denial of admissions, loss of
certification as a provider under federal healthcare programs or other sanctions,
including criminal penalties.
The regulatory environment surrounding the senior living industry continues to
evolve and intensify in the amount and type of laws and regulations affecting it,
many of which vary from state to state. Companies may be unable to predict the
future course of federal, state and local legislation or regulation. If regulatory
requirements increase, whether through enactment of new laws or regulations
or changes in the enforcement of existing rules, revenue and profitability could
be adversely affected.
Industry Outlook
The Retirement Communities industry is forecast to expand through 2016,
generating 2.4% annual average growth and reaching $43.9 billion in revenue.
Revenue growth in 2012 is forecast to accelerate to 3.3% as demand restrained
during the economic recession will temporarily pick up. During the following
years, an improving economic environment, an aging population, favorable
healthcare reform and new service offerings will support continued growth.
Indi vi duals aged 65 and over are increasingly technologically conscious, and
technologically advanced facilities will attract this significant and growing
demographic. More rooms will have instant voice and visual access to family
and friends, and facili ties will feature a wide variety of medical sources ranging
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from physicians to nutritionists. Technology will be able to measure calorie
intake, weight gain and loss, changes in hearing, eyesight, blood pressure and
vital signs.
Industry Ratios
Revenue ($m)
Establishments
Employment
Wages ($m)
2007
36,256.50
20,729
740,864
16,670.40
2008
36,649.50
20,507
678,950
14,220.00
2009
36,973.20
20,468
653,354
14,548.90
2010
37,889.80
20,278
659,887
14,909.70
2011
38,931.80
20,401
668,796
15,358.60
2012
40,209.70
20,434
678,828
15,902.90
2013
40,963.30
20,376
689,689
16,205.10
2014
41,919.70
20,452
701,413
16,625.30
2015
42,416.10
20,552
713,338
16,864.60
2016
43,922.40
20,710
726,178
17,467.90
Communication connectivity will also be more frequent, fac ilitating residents'
ability to maintain a healthy and vibrant lifestyle, while allowing operators to
reduce accidents and liabilities. Also, the industry will design more home -like
facilities that offer the ability to socialize in an integrated and welcom ing
gathering place. Operators will likely incorporate better and more creative use
of light, sound, water and greenery in new developments.
Competitive Analysis
Basis of Competition
Competition in this industry is high and the trend is steady . The Retirement
Communities industry is highly competitive, as evi denced by the large number
of operators and low average profit margin. The competitive environment is
attributable to low barriers to entry and periods of excess supply. Industry
companies compete among themselves and with other organizations that
provide similar senior living alternatives, such as home healthcare agencies,
community-based service programs and skilled nursing facilities. In general,
regulatory and other barriers to competitive entry in the retirement center and
assisted living sectors of the senior living industry are not substantial, except in
the skilled nursing area. Although new construction of senior living
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communities has declined in recent years, oversupply has troubled the indus try,
leading to competition that pressures profitability.
Location, location, location
Competition in this industry is principally based on location. Residents want to
be close to family and friends and feel that they are in a familiar area. While
achieving geographic diversity is advantageous, operators tend to focus on
areas that have dense populations of seniors, such as Florida and California.
In addition to location, product positioning is an integral basis of competition.
Some regions lend themselves to specific types of services. If a large portion of
the local population is approaching 85 years and over, memory services are key.
Further, companies that focus on only one or two core business strategies are
more likely to achieve sustained growth and survi ve economic recession,
according to the Assisted Living Federation of Amer ica. Hence, companies
shoul d clearly define their set of products, customer segments, and technologies
that build the greatest competitive advantage in the local area.
Within any region, companies can gain market power by building a well -defined
customer segment and developing and maintaining customer loyalty. This is a
particularly powerful strategy in retirement communities and senior living
because it is a high-touch, personal business that invol ves residents and
families.
Barriers to Entry
Barriers to entry in this industry are low
and are increasing. The Retirement
Communities
industry
has
moderate
barriers to entry, particularly when there is
no certificate-of-need (CON) regulation. A
CON may be required in the case of
continuing care retirement centers (CCRCs).
CONs are legal documents required in
many states before proposed acquisitions,
expansions, or creations of medical facilities
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are allowed. Certificates-of-need are necessary for the construction of a medical
facility in 36 states and are issued by state healthcare agencies.
Operators must also adhere to other federal, state and local government laws
and regulations (which can be extensive) when establishing and o perating
facilities. For instance, facilities must be accredited and licensed. Many states
have imposed moratoria on new retirement homes beds.
Aside from regulation, barriers to entry are low. Capital costs per bed are lower
for senior living facilities than for hospitals, and new operators can enter the
market with little personal equity and high debt. Retirement homes do not need
highly specialized equipment and the labor force is less skilled than it is in
hospitals. Although licensing can be burdensom e, the costs to becoming
accredited are low. Finally, the market is highly fragmented, and there are few
very large operators. Therefore, operators can enter the market with a small
number of beds and compete with an existing facility.
However, operators must attract a critical mass of patients to be viable, and it
may be difficult for new entrants to establish referral relationships with medical
practitioners, insurers and hospitals, or awareness among the local community.
There also appear to be some a dvantages to larger operators in this industry.
Bigger companies can spread some costs (including information technology
costs) over many locations, can refer patients to their own facilities, and may be
in a better position to negotiate with suppliers and payers.
Entry barriers are relatively higher in the Continuing Care Retirement
Communities segment. Currently, about 80% of all CCRCs are owned and
operated by non-profit entities. CCRCs are often big projects, and many CCRCs
are large campuses on 20 to 50 acres of land.
Obtaining the necessary approvals can take years, and financing can be difficult
to obtain. For-profit developers and investors have tended to shy away from
CCRCs, focusing instead on rental projects.
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Risk Rating Analysis
Industry Risk Score
Forecast Period: Ending December 31, 2012
To calculate the overall risk score, the risks
pertaining to industry structure (structural
risk), expected future performance (growth
risk) and economic forces (sensitivity risk)
are assessed. Risk scores are based on a
scale of one to nine, where one represents the lowest risk and nine the highest.
The three types of risk are scored separately, then weighted and combined to
deri ve the overall risk score.
Structural Risk Analysis
Structural risk is forecast to be MEDIUM-LOW. This highly competitive, as
evi denced by the large number of operators and low average profit margin. The
competitive environment is attributable to low barriers to entry and periods of
excess supply. Industry companies compete among themselves and with other
organizations that provi de similar senior living alternatives, such as home
healthcare agencies, community-based service programs and skilled nursing
facilities. Even though the industry has no specific tariffs, it experiences a high
level of industry assistance through government funding. Revenue volatility is
low, as a result of being partially buffered government fundi ng which reduces
fluctuations.
Sensitivity Risk
Sensitivity risk is forecast to be MEDIUM -LOW over the outlook period, down
from MEDIUM in 2011. The two factors with the most significant impacts on the
industry are number of adults over 65 years old and house price index. A rise in
either of these factors will lower industry risk.
13.3 IBISWorld Industry Market Analysis for NAICS Code 236620
NAICS Code Definition and Market Overview
This
industry
comprises
establishments
primarily
responsible
for
the
construction (including new work, additions, alterations, maintenance, and
repairs) of commercial and institutiona l buildings and related structures, such
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as stadiums, grain elevators, and indoor swimming facilities. This industry
includes establishments responsible for the on-site assembly of modular or
prefabricated commercial and institutional buildings. Included i n this industry
are commercial and institutional building general contractors, commercial and
institutional building operative builders, commercial and institutional building
design-build firms, and commercial and institutional building project
construction management firms. A snapshot of this industry’s performance is
shown below.
Products and Services
The Commercial Building Construction industry's principal activities are auto
service and sales store construction; entertainment and recreation buildin g
construction (i.e. casinos, gyms, cinemas and arenas); hotel and motel
construction; office building construction; public commercial warehouse
construction; radio and television broadcast studio construction; restaurant, café
and bar construction; retail store construction; service and gas station
construction; shopping center or shopping mall construction.
Product and services segmentation
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Industry firms provide general contracting services; remodeling contracting
services; construction management ser vices; other non-building construction
activities; and other business activities.
Market Share Concentration
Concentration in this industry is low. The industry has a low level of
concentration, with the four largest players accounting for about 5.7% of
industry revenue. The largest industry participants are general contractors, but
these firms often use subcontractors and local firms to develop projects. As a
result, most participants are subcontractors that compete on a local or regional
basis. Additionally, large participants operate in several construction segments
outside commercial building including civil projects, and municipal and
institutional building construction, which further dilutes the concentration of
industry revenue.
About two-thirds of establishments employ fewer than 10 people, including
47.0% of firms that employ fewer than five people. About 2.0% of industry
establishments employ more than 100 people. These large -scale players are
multi-establishment companies with branches that oper ate across many states
and regions.
Revenue Volatility
The level of volatility is high. The industry has a high level of volatility. The
industry is exposed to wide cyclical fluctuations in demand, resulting from
movements in long-term interest rates, general economic growth and expected
rental yield. The industry was especially volatile in the past five years due to
the sudden drop off in demand caused by the contraction in business activity
and investment during the recession. Revenue dropped by as much as 30.3% in
2010 after growing by 3.0% in 2008.
Industry Outlook
Continued economic recovery translated into lower unemployment, greater
consumer spending, and a drop in office vacancies, will drive improvement in
the commercial building construction industry in the next fi ve years. The
industry's recovery will be slow as it continues to be plagued by high vacancy
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rates, which generally spike during economic downturns. The previous real
estate boom will initially hinder growth because many markets remain
overbuilt.
Industry Ratios
Year
Revenue ($m)
Establishments
Employment
Wages ($m)
Private Nonresidential
Construction ($ Billion)
2007
217,759.30
32,293
447,005
93,636.50
438,200.00
2008
224,888.60
32,664
447,684
99,873.00
466,400.00
2009
158,142.00
32,212
380,747
83,499.00
367,300.00
2010
110,197.50
31,816
349,319
75,264.90
309,100.00
2011
103,749.90
31,537
334,927
70,861.20
319,900.00
2012
105,880.00
32,349
351,673
74,038.40
329,500.00
2013
111,796.00
33,149
373,829
79,865.70
407,000.00
2014
120,188.60
33,599
414,202
94,767.80
439,400.00
2015
129,924.70
34,909
451,480
95,616.60
472,800.00
2016
139,737.80
36,329
466,831
100,994.30
537,800.00
2017
147,080.50
36,610
499,509
113,614.70
588,600.00
Similarly, the industry will be hampered by high unemployment, which will
remain elevated for most of the next five years due to the employment market's
slow recovery. Nonetheless, recovery in the industry is expected to gain
momentum in 2013, with revenue forecast to grow 5.6% to $147.1 billion.
Consumer and business confidence will need to increase significantly before
high investment activity takes place in the commercial real estate market.
Spending on renovations of existing facilities will strengthen as corporate profit
and business operations also improve, and a growing economy will boost
demand for new construction of offices, retail buildings, hotels and other
commercial structures. The Commercial Building Construction industry's
revenue is expected to increase at an average annual rate of 6.8% t o $147.1
billion in 2017, as businesses gradually recover and begin expandi ng operations,
which will increase demand for new construction. Economic recovery will also
strengthen investment into the real estate market as property values inch
upward and commercial rent rises.
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Competitive Analysis
Basis of Competition
Competition in this industry is high and the trend is steady. This industry is
characterized by highly competitive conditions on a regional and national basis
and across all scales of operation. Competition between contractors typically
occurs on the basis of proven quality and technical capacity and efficiency,
rather than solely on the basis of price differentiation. Price tends to be more
important on smaller-scale or less complex constructi on projects and on public
sector-funded contracts.
Large-scale construction projects are typically either put to public tender (i.e.
advertised in the media or through government publications) or put to a closed
tender, where the client invites selected c ontractors to quote on a project. The
selection of contractors for a closed tender is based on the operator's reputation
or past performance and close relationships with developers and financiers.
Tendering on extremely large or complex construction projec ts is confined to a
few large-scale players.
Most small- to medium-scale building contractors confine their activities to a
localized market. Several builders have established solid reputations in narrow
market segments (e.g. restaurants and cafes or comm ercial parking lots) and
leveraged this experience to generate contracts across broad geographical
markets.
Small-scale operators rely very heavily on word-of-mouth referrals to obtain
private sector contracts, but they also advertise in general media an d some use
the internet to promote their businesses. It is common for smaller operators to
establish relationships with prime contractors and property developers within a
local region or specialized area.
There is a growing trend for building contractors to take an equity interest in
the development consortium on projects such as office complexes. This trend
effectively blocks competition from other builders and ensures the work flow for
the contractor involved. Equity involvement by the builder is apparen t across all
scales of construction.
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Barriers to Entry
Barriers to entry in this industry are low
and are steady. New industry entrants face
a number of challenges, mostly related to
access to capital. Construction projects
require an extensive outlay of resources, in
terms of both materials and labor. This
means that securing ample finance for
upcoming projects is something that new
construction companies can't afford to fall short of. Initial finance typically
comes from investors and bank loans, howe ver business lending has tightened
in the past fi ve years. Strict lending standards now exclude many business
owners (largely those that have experienced losses during the downturn) from
being eligible for loans. Success in the industry largely depends on the number
of projects in the pi peline. New entrants will also be at a disadvantage
compared with larger more established firms that maintain good banking
relationships, which allow them to more nimbly access capital for upcoming
projects. New construction companies also face the challenge of finding skilled
financial leaders to manage cash flow when there are projects underway.
Another key constraint to entry is the difficulty that new competitors may
encounter in trying to gain a foothold in the market d ue to their lack of an
established reputation. Establishing client relationships is critical to the success
of companies in the industry. Existing firms have the distinct advantage of
already having a pool of skilled subcontractors, arrangements with mater ial
suppliers and arrangements with financial institutions and property developers.
Most new entrants enter this industry from subcontracting special trade skills
(notably carpentry and concreting contracting); therefore, they may enter with
pre-established reputations and relationships with property developers or
general contractors.
The growing trend for building contractors to take an equity interest in the
development consortium on projects effectively blocks competition from other
builders. Smaller contractors in particular are working together on certain
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projects as it improves the ability to compete with larger firms, especially with
large complex developments. Contractors are increasingly working together to
reduce risk. However, new entrants to the industry - with limited financial
resources and narrow networks of business contacts - will likely be excluded
from equity participation in such development consortiums.
Commercial construction contractors must hold appropriate licensing and
registration to operate in each state, which can be a deterrent to some entrants
to the industry.
Industry Risk Score
Forecast Period: Ending December 31, 2012
To calculate the overall risk score, the risks
pertaining to industry structure (structural
risk), expected future performance (growth
risk) and economic forces (sensitivity risk) are
assessed. Risk scores are based on a scale of
one to nine, where one represents the lowest risk and nine the highest. The
three types of risk are scored separately, then weighted and combined to derive
the overall risk score.
Structural Risk Analysis
Structural risk will be HIGH over the outlook period. The largest risk factor in
this industry is the high level of competition. Businesses competing fiercely for
market share are forced to inc ur expenses to differentiate their offerings, keep
prices low to entice demand or both. The result is a greater likelihood of
declining revenue and lower profits. The competition risk is exacerbated by the
low barriers to entry, which will keep competition high over the long term. In
addition, the industry must deal with high revenue volatility, which requires
prudent management of cash flows and planning in the face of uncertain
demand. Businesses that fail to account for these challenges a re at a risk for
sudden losses or diminished margins.
Sensitivity Risk
Sensitivity risk is forecast to be MEDIUM over the outlook period, unchanged
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from MEDIUM in 2011. The two factors with the most significant impacts on the
industry are consumer spending and rental vacancy rates. When there is a rise
in consumer spending, risk will fall; whereas a rise in rental vacancy rates will
cause industry risk to increase.
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14.0 Competition
This map and the chart below show the locations of the new enterpri ses primary
competitors. The Company plans an aggressive entry into the market to
establish its brand.
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Facility Name
Anderson Mill Assisted Living
Arboleda House
Arden Courts of Austin
Argent Court Assisted Living
Ashwood Retirement & Assisted
Back To Eden Group Home
Barton Creek Senior Living
Barton Hills Assisted Living
Brighton Gardens Of Austin
Brookdale Senior Living
Brookdale Senior Living
Brookdale-Summit At Lakeway Buckner Villas
Clairmont-Austin
Collinfield House
Colonial Gardens
Continental Retirement Community
Elm Crost
Emeritus at Beckett Meadows
Emeritus at North Austin
Emeritus at Spicewood Springs
Gardens Franklin
Gracy Woods II Nursing Ctr
Greenridge At Buckner Villas
Hannah's Place
Heritage At Gaines Ranch
Heritage Plaza Retire Comm
Horizon Bay
Longhorn Village
Merrill Gardens
Merrill Gardens At Round Rock
Paradise Court Assisted Living
Parmer Woods
Pavilion Assisted Living LLC
Pavilion At Great Hills
Plaza At Querencia
Premieant
Premieant
Premieant
Premieant Inc
Querencia At Barton Creek
Regency Village Care Ctr
South Austin Assisted Living
Southern Hospitality Home
St George's Court
Address
11009 El Salido Pkwy
7502 Arboleda Cv
11630 Four Iron Dr
508 Old Austin Hwy
12151 Hunters Chase Dr
11201 Plains Trl
2500 Barton Creek Blvd
1606 Nash Ave
4401 Spicewood Springs Rd
11200 Terrace Bluff Dr
4409 Gaines Ranch Loop
1915 Lohmans Crossing Rd
11110 Tom Adams Dr
12463 Los Indios Trl
9205 Collinfield Dr
3706 Adelphi Ln
4604 S Lamar Blvd
7017 Manchaca Rd
7709 Beckett Rd
5310 Duval Rd
4401 Spicewood Springs Rd
3522 E Martin Luther King Jr Blvd
12042 Bittern Holw
11110 Tom Adams Dr
12251 Running Bird Ln
4409 Gaines Ranch Loop
9121 North Plz
8005 Cornerwood Dr
12501 Longhorn Pkwy
12429 Scofield Farms Dr Apt 114
8005 Cornerwood Dr
14109 FM 969
12429 Scofield Farms Dr Apt 114
11819 Pavilion Blvd
11819 Pavilion Blvd
2500 Barton Creek Blvd
1110 W William Cannon Dr Ste 201
3215 Western Dr
7906 Brodie Ln
4700 Ganymede Dr
2500 Barton Creek Blvd
6500 Brush Country Rd
4601 Chesney Ridge Dr
5000 Shoalwood Ave
1443 Coronado Hills Dr
Page 80
City
Austin
Austin
Austin
Bastrop
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
Austin
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
15.0 Strategy and Implementation
The Company is hiring a management company well-known in this arena,
Assisted Li ving Management, to organize and oversee the implementation of the
project.

The Company will hire a full -time salesperson who is comfortable making
sales calls within the market and who can develop relationships of trust
with both referral sources and potential residents.

A web page will be developed that brings leads to the facility, makes the
brand visible in the community and educates potential residents as well as
their families.

The Company will involve itself in the medical world of the current
residents. Accompany them to hospitals and doctor’s offices and make
sure the doctors and nurses know who is caring for them. The medical
visits become marketing opportunities.
They will mail and deliver
information to these referral sources and consider holding l uncheons in
doctors' offices to spend time answering their questions. Every resident
has a physician, a dentist, a cardiologist/other specialist, even a funeral
home where they have relationships. All will be listed in resi dent files and
will be made aware of the Company.

A priority will be to increase visibility in the market. There are many
competitors in the market and the Company needs to be easy to know
about, easy to locate, and be top of mind to referral sources.

There are scores of Skilled Nursing Facilities in the area; help their
discharge planners. They need affordable and quality care for patients.
They have time constraints from insurance plans, and pressure to reduce
re-admission to hospitals. They must be aware of what we offer and what
our strong suits are. Hosting happy hours or spa days are ways to focus
on these professionals.

The Company will enforce a culture of YES for move-ins. The entire staff
must understand that sales are the number one priority of the community.
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SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s

The Company will notify referral agencies of our strengths with the belief
that this will result in multiple leads. Good relationships with the ones
who conduct business ethically are win-win.

A major goal is to minimize attrition, which is also known as the back
door. Family concerns will be addressed immediately and thoroughly.
The Executive Director will be present and approachable. The Company
will offer solutions before the situation becomes a move -out or a
hospitalization.

The Company will be on the VA referral list as well as on the referral lists
for major health maintenance organizations and the Housing Authority.

The Company will produce a comprehensive Move-in Generation Plan
and Event and Media advertising plan, updated quarterly.

Competitive analyses of the local market will be completed quarterly to
determine the most effective strategies and realign the current strategy, if
necessary.

The operating plan will leverage uncovered strengths, weaknesses,
opportunities and threats for targeted sales r esults.

There will be a Resident-Focused Sales Guidelines Training that will include
training the Leadershi p Team and Front Desk.

The facility will develop strategic partnerships with referral sources such
as healthcare providers, physicians, clergy, a gencies on aging, home
health agencies, social workers, and case workers.

Facility personnel will focus on making move-ins happen quickly, within
24 to 48 hours.

Training will be given on new resident discovery process, giving effective
tours and closing.
Page 82
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s

A program of Everyone Sells will be implemented.

The sales process will be continuously monitored using VITALS. LEAD
VITALS processes intelligence gathered in the outbound effort to further
refine the prospect targets and value proposition to track leads, new
inquires, tours, move-ins and measurable sales statistics while
maintaining and updating the customer relationship management lead
tracking database. It further enables the Company to c ultivate existing
leads.

The Company will implement a Choose Your Neighbor resident referral
program to increase family and resident referrals.
Page 83
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
16.0 Financial Plan
16.1 Balance Sheet Projection
Balance Sheet Projection
ASSETS
2014
2015
2016
2017
2018
Cash
Current Assets
Total Current Assets
$3,868,634
$0
$3,868,634
$4,066,753
$0
$4,066,753
$4,279,565
$0
$4,279,565
$4,543,028
$0
$4,543,028
$4,867,769
$0
$4,867,769
Capitalized Expenditures
Accumulated Depreciation
Net Long-term assets
$6,300,000
$220,000
$6,080,000
$6,324,000
$440,000
$5,884,000
$6,360,000
$660,800
$5,699,200
$6,408,000
$882,000
$5,526,000
$6,451,184
$1,103,600
$5,347,584
TOTAL ASSETS
$9,948,634
$9,950,753
$9,978,765
$10,069,028
$10,215,353
$0
$0
$0
$0
$0
$0
$6,300,000
$0
$6,300,000
$0
$6,300,000
$0
$6,300,000
$0
$6,300,000
$6,300,000
$6,300,000
$6,300,000
$6,300,000
$6,300,000
$3,648,634
$3,650,753
$3,678,765
$3,769,028
$3,915,353
$9,948,634
$9,950,753
$9,978,765
$10,069,028
$10,215,353
LIABILITIES
Current Liabilities/Deferred Revenue
Long-Term Liabilities:
Construction Loan
Loans from Domestic Sources
TOTAL LIABILITIES
SHAREHOLDER EQUITY
Total Owner Equity
TOTAL LIABILITIES AND EQUITY
Page 84
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
16.2 Five-Year Annual Income Statement
Income Statement Projection
END OF YEAR
Jan-14
1
Jan-15
2
Jan-16
3
Jan-17
4
Jan-18
5
Revenues
Application Fees
Deposits
Rent
Ancillary Income
Total Revenues
$19,868
$59,437
$2,238,425
$36,755
$2,354,486
$7,280
$21,840
$3,711,714
$76,959
$3,817,793
$7,280
$21,840
$3,856,793
$82,419
$3,968,331
$7,280
$21,840
$4,072,330
$85,799
$4,187,248
$7,280
$21,840
$4,683,632
$102,147
$4,798,169
Expenses
Administration
Management Fee
Marketing
Nursing
Activities
Laundry & Housekeeping
Dietary
Maintenance & Security
Transportation
Utilities
Property Taxes
Insurance
Other
Incentive Bonus
Total Cash Op. Expenses
$154,637
$122,352
$88,246
$420,864
$57,120
$108,113
$315,234
$89,901
$63,577
$150,498
$205,962
$48,179
$24,338
$27,152
$1,876,171
$232,437
$190,838
$73,839
$675,992
$55,119
$130,778
$430,555
$102,179
$78,259
$165,358
$199,678
$46,799
$23,660
$75,659
$2,481,149
$240,497
$198,378
$70,979
$701,991
$56,419
$134,158
$437,055
$104,779
$80,339
$169,518
$204,877
$47,839
$23,660
$82,419
$2,552,909
$248,817
$209,297
$71,239
$727,991
$57,719
$137,538
$443,815
$107,379
$82,419
$173,678
$209,817
$49,139
$23,660
$95,159
$2,637,668
$292,688
$239,908
$86,367
$849,276
$67,174
$163,138
$527,799
$124,752
$95,963
$206,321
$249,505
$57,578
$28,789
$100,762
$3,085,222
Net Operating Income
$478,314
$1,336,644
$1,415,423
$1,549,581
$1,712,946
Debt Service / Lease Costs
($720,030)
($738,000)
($756,450)
($775,361)
($858,872)
Depreciation
($220,000)
($220,000)
($220,800)
($221,200)
($221,600)
Taxable Income
($461,716)
$378,644
$438,173
$553,020
$632,474
($132,525)
($153,361)
($193,557)
($221,366)
$246,119
$284,812
$359,463
$411,108
Tax Charge
NET INCOME
$0
($461,716)
Page 85
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
16.3 Five-Year Annual Cash Flow
Statement of Cash Flows Projection
2014
2015
2016
2017
2018
($461,716)
$246,119
$284,812
$359,463
$411,108
$0
$220,000
$720,030
$132,525
$220,000
$738,000
$153,361
$220,800
$756,450
$193,557
$221,200
$775,361
$221,366
$221,600
$858,872
$478,314
$1,336,644
$1,415,423
$1,549,581
$1,712,946
$24,000
$36,000
$48,000
$43,184
($6,300,000)
$6,300,000
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Tax charge
Depreciation
Debt Interest
$0
($220,000)
($720,030)
($132,525)
($220,000)
($738,000)
($153,361)
($220,800)
($756,450)
($193,557)
($221,200)
($775,361)
($221,366)
($221,600)
($858,872)
Total, Other
($940,030)
($1,090,525)
($1,130,611)
($1,190,118)
($1,301,838)
Increase (Decrease) in cash
($461,716)
$198,119
$212,812
$263,463
$324,741
Cash, Beginning of Year
Cash, End of Year
$4,330,350
$3,868,634
$3,868,634
$4,066,753
$4,066,753
$4,279,565
$4,279,565
$4,543,028
$4,543,028
$4,867,769
Cash flows from Operating Activities
Net Income
Adjustments to Reconcile:
Tax charge
Depreciation
Debt Interest
Total, Operating Activities
Cash flows, investing activities
Total Capital Spending
$0
Cash flows, financing activities
Construction Loan Principal, Payoff
Loans from Domestic Sources, Proceeds
Total, Financing Activities (Net)
Cash flows, Other
Page 86
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
Data Sources
Raw data analyzed for Southwest Business Services’ market research data and
competitive analysis reports is sourced from an array of the nation's government
and pri vate statistical sources. None of these raw data sources creates the final
measures reflected in industry profiles. In total, data elements are sourced
specifically from:
- Dun and Bradstreet
- Demographics.com
- Surveys
- Personal Interviews
- IRS SOI Corporation Income Tax Returns
- IRS SOI Corporation Tax Book
- IRS SOI 1040 Schedule C Income Tax Returns
- IRS SOI Statistics of Income- Indi vidual Tax Statistics
- United States Economic Census of Manufactures
-
United States Census Economy Overview
United States Census Annual Survey of Manufactures
United States Census Annual Retail Trade Survey
United States Census Annual Wholesale Trade Survey
United States Census Quarterly Financial Reports
United States Census County Business Patterns
Bureau of Labor Statistics Monthly Employment Reports
Bureau of Labor Statistics Monthly Unemployment Reports
United States Census Wholesale Trade Report
United States Census Quarterly (New Housing) Sales by Price and Financing
-
United States Census Total Construction Spending
United States Census Retail Trade Report
United States Census Quarterly Services Survey
Commercial Real Estate Survey
Credit Reporting Agencies
Business Directories
While 100% firm coverage is desirable for analysis purposes, the greatest value
of reports rests in discerning patterns of activity, w hich are reflected in the large
Page 88
SUNSET AR MS ASSISTED LIVING FACILITY,
LLC
A u stin, T ex a s
samples used to develop our reports. The overall current coverage of the
databases surpasses 13 million active business operations at any point in time.
To the best of our knowledge, the data contained in our business plans is valid
through 2011.
Page 89