| ADVISORY SERVICES |
| Building Life Study Non-profit hospitals use building life studies to justify and quantify the setting (new construction) or changing (existing improvements) of the remaining useful life of a property. Building life studies provide a detailed analysis of individual building components by actual remaining life. These studies will typically extend the life of the assets and reduce the annual depreciation. The longer life may benefit the property owner by extending the permitted amortization period for bond financing and ultimately increasing cash flow. |
| Cost Segregation Study Cost segregation studies identify and separate a facility's personal property assets (such as a building's non-structural elements, site improvements, and indirect construction costs) from real property assets. Reclassifying assets as personal property benefits the for-profit property owner by increasing depreciation expense, thus reducing current income tax obligations. Our professionals have performed cost segregation studies on healthcare facilities ranging in size from small medical office buildings to hospitals with over one million square feet, allowing our clients to accelerate millions of dollars of depreciation deductions for tax savings and financial reporting purposes. |
| Asset Inventory Most healthcare entities don't have an accurate account of their fixed assets-resulting in annual losses from insurance overpayment, tax overpayment, inefficiencies, and regulatory non-compliance. Our professionals perform fixed asset valuations across all sectors of the healthcare industry, covering buildings, personal property, and all varieties of office, industrial, and medical equipment. Principle Valuation's asset inventory services consistently provide clients with cost reductions in a cost-effective, accurate, and efficient manner. |
| Site Selection Few decisions in the development process are as important as choosing a project’s location, and Principle Valuation offers comprehensive site selection services for hospitals and senior housing communities. Our proprietary site selection model isolates and ranks underserved markets and then analyzes the chosen market for the best possible competitive location. Principle Valuation’s experts can analyze a developer’s site or recommend sites based on the project concept and geographic preferences. |
| Concept Planning Concept planning frequently goes hand-in-hand with site selection and is the critical first step in the development of any new project. It involves a thorough review of the site’s physical and legal constraints and the definition of the proposed property’s optimal services, operations, target market, and physical design. Principle Valuation’s team has visited, toured, appraised, or consulted for literally thousands of hospitals and senior housing communities. Our concept planning services allow developers to take advantage of our extensive experience which provides us with unique knowledge of what separates successful projects from unsuccessful projects. |
| Market Studies and Marketability Studies Principle Valuation performs market studies for all types of existing and proposed healthcare and senior housing projects. We provide various levels of analysis ranging from preliminary supply/demand tests to comprehensive analysis of the competitive market and existing and proposed competition. Our marketability studies go a step further by not only analyzing the market but also gauging how a specific project will fare against local competition, how it will be perceived by the local market, and how successful it will be at capturing market share of key income demographics. Whether for a 60-bed project or a 1,000-unit campus, our market and marketability studies are invaluable resources which allow developers to adapt their project concepts to the preferences of the local market before making costly mistakes. |
| Feasibility Studies Feasibility studies for proposed properties or conversions of existing properties contain all of the elements of a marketability study but also involve a detailed construction cost estimate, cash flow projection, and computation of the expected return on investment. While most firms add little value by filling feasibility studies with reams of third-party data tables and other easily obtainable information, Principle Valuation’s feasibility studies are based upon on market-specific knowledge and insightful analysis. |
| Expert Witness Testimony and Litigation Support Principle Valuation’s professionals have testified as expert witnesses in a wide variety of state and federal courts for cases involving hospitals and senior living properties. We can assist legal counsel in a variety of areas, including valuations of complete or partial interests, assessments of damages, conflicts of interest, breaches of contract, and bankruptcies. |
| Highest and Best Use Analysis Many healthcare property owners have areas of excess or surplus undeveloped land near or adjacent to their existing buildings. However, we routinely find that neither the owner nor the management team has a firm grasp of the wide variety of possible uses of their land and consequently undertake sub-optimal development projects. Principle Valuation’s highest and best use services involve a comprehensive analysis of the vacant site as well as the owner’s nearby operations to determine the use would result in the highest value of the land to the owner, whether it be to hold for future development, expansion of the existing property, or sale to a third party. |
| Fairness Opinions Fairness opinions are used to judge the fairness of one entity’s offer to buy another entity in a merger or acquisition and require an in-depth understanding of the deal’s structure, risks, and pricing relative to deals for comparable entities or assets. A fairness opinion is critical in situations which involve possible conflicts of interest or when one party is much more knowledgeable than another party. For transactions involving healthcare facilities, this requires a complete understanding of the healthcare real estate industry and extensive experience with related transactions. Both acquirers and targets turn to Principle Valuation for an objective, independent, and professional judgment of the fairness of an offer. |