County board to consider recommendation, decide whether to list facility for sale
By Tina L. Scott
MMC Staff
MERRILL – On Wednesday, June 28, the Administrative and Legislative (A&L) Committee of the Lincoln County Board of Supervisors met to review three proposals received from interested commercial brokers in response to the county’s request for proposals (RFP) regarding the potential sale of Pine Crest Nursing Home in Merrill.
The members of the committee discussed the contents of each proposal and spoke with representatives in attendance via video from two of the brokers that submitted proposals.
It didn’t take long for the committee to narrow the choices down to two, eliminating the proposal submitted by Evans Senior Investments.
That left proposals from SVN and Marcus & Millichap.
Jay Hintze, Executive Director of SVN Hintze Commercial Real Estate, spoke to the committee and said his firm had buyers ready to write an offer on Pine Crest.
Hintze said their initial written bid of a 4% commission was flexible and could potentially be reduced to 3%, but admitted his firm was relatively new to representing skilled nursing home properties. Hintze also said he hadn’t had an opportunity to tour the actual Pine Crest facility when he was in Merrill.
Hintze’s firm proposed to list Pine Crest for sale for $4.6 million.
Ray Giannini, Senior Managing Director of Marcus & Millichap REIS Seniors Housing Division, spoke to the committee and proposed to list Pine Crest for – and said he was “confident” their firm could get – $8.5 million from proposed buyers.
Giannini stressed his company’s experience in representing and selling senior housing real estate. Marcus & Millichap proposed a flat fixed fee of 3% of the purchase price, should his firm list and sell the facility.
The Marcus & Millichap proposal emphasized Giannini’s 27-year history with the firm and that the firm had sold more than $700 million of senior housing real estate, half of which was specific to skilled nursing facilities.
Prior to that, Giannini worked as a Senior Acquisition Analyst at a top-ten, for-profit owner and provider of skilled nursing services with 250-plus facilities in 14 states.
Marcus & Millichap’s proposal provided recent comparable sales of skilled nursing homes in Wisconsin.
After discussions, and without the need to go into closed session, the A&L Committee decided to recommend Marcus & Millichap as the broker to represent Lincoln County, should the Lincoln County board vote to move forward with listing Pine Crest for sale.
Committee members cited the broker’s lengthy experience working with and representing skilled nursing home facilities, the 3% proposed broker fee and Giannini’s confidence in finding a buyer who would pay $8.5 million for the property, a full $3.9 million more than the sales price SVN had proposed.
In addition, they noted Marcus & Millichap had taken a personal tour of Pine Crest and developed a thoroughly researched, personalized presentation focusing on the facility and the Merrill community specifically and had also demonstrated how they would market the property.
The firm’s proposed timetable suggested they would be able to market the property and deliver the Lincoln County board with Letters of Intent from interested buyers within 50 days of signing a contract with their firm. That would leave time for additional negotiations and could still result in a closing six months from the signing of the contract.
Now it is up to the Lincoln County board to decide if they will sign with the broker recommended by the A&L Committee and if they will officially list Pine Crest Nursing Home for sale.
The Lincoln County Board of Supervisors will meet on Tuesday, July 18, at 6 p.m. at the Lincoln County Service Center in Merrill. The public can also attend the meeting remotely.
The agenda for the meeting and a link to attend remotely will be available on the county’s website at www.co.lincoln.wi.us/meetings.