Nonprofit organizations sponsoring new continuing care retirement community (CCRCs) projects need to assemble a development team with skills in real estate development, financing strategies, health care services, hospitality, marketing, and insurance. In its most recent Strategies in Capital Finance white paper titled “CCRCs: Bringing Transparency to the Development Process – the Key to Greater CCRC Viability,” Cain Brothers recommends that nonprofit sponsors identify the critical development components and pursue a transparent selection process of the component providers. The transparent selection process will align developer incentives with long-term project success, lower developer fees, lower marketing fees, achieve less costly financing arrangements, and increase overall affordability and project viability.

Many nonprofit organizations have outsourced development using a turn-key model whereby the entire development process, including the seed capital and financing components are provided in a bundled arrangement. Bill Pomeranz, Senior Vice President at Cain Brothers said, “While this model can be appealing to executives with too much on their plates, it has often resulted in projects that are just too expensive.”

Working with a financial adviser like Cain Brothers that understands the CCRC industry and the local land use process and has experience with the challenges of assembling a development team can be of enormous assistance. A qualified financial advisor can guide the organization through an iterative, structured process to identify particular strengths and costs associated with the various development team members and ways to translate those strengths into a more affordable, and, therefore, viable project with a better chance of financial success.

Please visit the Strategies page on our website to download this report or email strategies48@cainbrothers.com to request a hard copy.

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Cain Brothers is an investment banking firm that focuses exclusively on the health care industry. Its clients include providers, payors, medical device and equipment companies, information technology companies, and providers of outsourcing solutions to the health care industry. The firm has one of the largest teams of experienced bankers and traders on Wall Street dedicated to the health care industry. Operating out of offices in New York, Chicago, Houston, Indianapolis, and San Francisco, Cain Brothers creates custom-tailored, market-based solutions for the many strategic, financial, and operating challenges facing its clients. Cain Brothers’ venture capital affiliates, Health Enterprise Partners and CB Health Ventures, invest capital in fast-growing health care service and information technology companies.

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Contact Jim Vaughan
212-981-6929
jvaughan@cainbrothers.com