Owning a Rest Home


What is a Rest Home?

A home for the elderly providing 24 hour care and all meals.  The size of a Rest home can range from 10 beds upwards.  The Ministry of Health funds the majority of payments providing a guaranteed income.

Staffing Requirements of a Rest home:
•    10 or fewer subsidized residents – 1 care staff member on duty at all times
•    Up to and including 30 Subsided residents – 1 care member and one call staff member on duty at all times
•    More than 30 subsidized residents – at least two care staff members on duty at all times
•    More than 60 subsidized residents – at least 3 care members on duty at all times


What is a Specialist Dementia Unit?

These are small, usually no more than 20 beds.  They provide higher levels of staff, trained in Dementia.  The Ministry of Health funds the unit; payments are higher due to higher care levels.  

Staffing Requirements of a Dementia Unit:
•    1 staff member on duty at all times, with another readily available


What is a Private Hospital?

This is a Hospital that cares for the elderly who need nursing due to illness and disability, although they are called Hospitals they are very different to public hospitals, payment for long term care is funded by The Ministry of Health.

Staffing Requirements for a Private Hospital:         
•    1 staff member on duty at all times
•    1 Registered Nurse on duty at all times
•    Extra staff as per number of residents


What is a Specialist Private Hospital?

Specialist Private Hospital residents have high dependency needs coupled with challenging or antisocial behavior.  The behavior may be due to Dementia, or the combination of age related disability and a mental condition.  Staff members are trained to manage this type of behavior.

Staffing Requirements Specialist Private Hospital:
•    Two staff members on duty at all times – 1 Registered Nurse and I care giver
•    More staff depending on the number of residents


Owning a Rest home, Dementia Unit or Private Hospital

Owning a Rest home can be both a rewarding and profitable investment.  Whether you wish to invest in a fully managed home or manage it yourself, owing a rest home is a worthy investment.  You can enter the Rest home industry at any level from lease to freehold, buying with a business partner or buying shares.  Entry level purchase prices can start from $90,000 through to $6million (depending on the number of beds and the value of the land and buildings) for a privately owned home.  

One of the positives of owning a rest home is that you have a guaranteed income per resident paid by the ministry of Health fortnightly; payments range from $710 - $850 per resident per week.  You can expect returns of between 20 – 50% depending on staffing levels, to be hands on operator or Registered Nurse is of benefit when buying a Rest home.

All Rest homes and Hospitals must be certified by the Ministry of Health.  Any facility receiving funding must also have a contract with their local Health Board and keep to the term of the contract. All Rest homes must also have Certification, to read about this go to www.moh.govt.nz/certification


What you will need to Own a Rest home

You will need to apply to the MOH for a Managers Certificate – you will need to be approved by the Director of General Health, for more info on this visit www.moh.govt.nz/certification or free phone 0800113813

Useful experience to have before buying a Rest home:
•    Work as a Nurse or experience in a Geriatric Ward
•    Budgeting / Accounting
•    Rest home work
•    Any other work in the Health Sector


 
Selling Your Rest home


Why Choose LINK?

We specialize in marketing and selling Retirement Homes and Private Hospitals but we're also in a position to sell all types of businesses.

We have a sound knowledge of the Industry, having owned and operated two Rest Homes. We are happy to pass on our knowledge and experience.

Being a part of LINK team we have access to a large database of local and international buyers and sellers, as well as specialist brokers, making us one of New Zealand’s leading Rest Homes Sales brokerages.
 
We can assist you with the preparation of the following information, in association with your advisors, to ensure the information is presented in the appropriate manner.

•    Profit and loss accounts for two to four years
•    A schedule of abnormal and/or non-recurring costs in the accounts
•    A schedule of all items of personal expenditure and drawings
•    Schedule of plant, equipment and any equipment leases
•    GST Returns for current trading year to date
•    Stock value estimate within 10-15%
•    Lease details including rent, term, renewals, outgoings, etc.
•    Staff levels, including part-timers and contractors


Achieving The Best Value

•    Managing the sale of your business
•    For many Rest home owners, selling up represents the culmination of years of personal effort and commitment, rewarded by the freedom that financial gains can yield.
•    For others, it’s a time when opportunities have been maximised in one area and new challenges beckon.
•    Whatever your intentions, we can help you along the way.
•    Selling a business has become a complex transaction that is subject to many legal and financial conditions, a number of which have come into force in recent years.
•    The commercial environment is also more competitive than ever before, and sensitive commercial information or intellectual property must be carefully protected.
•    Many business change hands every month in a planned, orderly way with the owners realising excellent value.
•    Others are sold in a less rigorous do-it-yourself fashion. This often leads to poor results which are compounded by frustrating delays and ongoing uncertainty.
•    Let us demonstrate the value of using a disciplined approach to selling your business.
 


The Sale Process


“Securing a purchaser’s trust and confidence is critical to achieving a successful sale.
Difficult questions will be asked and you must be prepared with honest, plausible answers.”
 
A potential purchaser will look closely at the information Memorandum and will consult with their financial and legal advisors to evaluate whether the business suits their purpose. We will seek further, more detailed information.  The level of information provided is determined by the Rest Home owner with advice from a us

The purchaser will eventually want to view the business and meet with the owner.  This will be arranged at a suitable time so as not to interfere with the operation of the business.

Provided the buyer has been supplied with all the basic information they require, we will work with the buyer and their professional advisors in preparing a Sale and Purchase Agreement detailing the price, terms and conditions of the offer.

We will liaise between you and the purchaser to facilitate agreement between both parties. Normally, a deposit of 10% will be paid by the purchaser on signing of the agreement; until the agreement becomes unconditional.