How much is your hospital worth?

Yesterday, Ventas, a healthcare real estate investment trust, purchased 68 independent and assisted living properties from Provident. $1.2 billion for 68 properties with a total of 6,819 units (about ~$176,000 per unit). Not surprisingly, revenues from the properties are largely private-pay.

How much is your hospital worth? Take a look at some hospital acquisition transactions from Levin Associates. Based on the two examples they give, the ballpark going rate for a typical, profitable hospital is $200,000 to $250,000 per bed. Put another way, hospitals are worth ~60 - 80% of their annual revenues. These are ballpark numbers only as hospital valuations are tricky; obviously, payor mix, location, capital structure, etc all factor in.