Report indicates nursing home has tremendous value
June 28th, 2006“A strong reputation.”
“Provides a superior product.”
“It has tremendous value.”
Those were a few of the comments from a preliminary valuation and assessment report from Pathways on Gaylord Lakeview Homes (Lakeview Home, Oak Terrace and Heritage House).
To better deal with an offer to purchase Gaylord Lakeview Homes, the City sought a valuation and assessment report from Pathways Health Services. According to City Administrator Lonny Johnson, Pathways is providing greater expertise and insight for determining the value of the three facilities.
Dennis Anderson, of Pathways Health Services, provided the City with a draft report Thursday. A final report will be presented by Anderson at the July 5th City Council meeting.
According to Anderson, Lakeview Home “looks pretty well” compared to nursing home standards today. He said it is “pretty incredible” that the nursing home has approximately $1.6 million in savings.
After an extensive tour of Gaylord Lakeview Homes, Anderson determined all three facilities are in “incredibly good physical shape.” He was surprised by the cleanliness and remarked that there were no unpleasant odors.
Anderson also commented on the space. He said Lakeview Home and Oak Terrace provide a beautiful setting with Lake Titloe on one side and a park on the other.
According to Anderson’s preliminary analysis, the revenue stream of Gaylord Lakeview Homes is $1.5 to $2 million. This does not include the $1.6-$1.7 million Gaylord Lakeview Homes has in savings.
With some efficiency changes, Anderson believes there is potential for an increase in the revenue stream value. Such changes would include reducing staff numbers, lower pay rates, lower number of hours staff works, lower benefits offered. All of these are over industry standards but the reason Gaylord has an excellent and top of the line home, Anderson explained.
If the City continues to operate like it is, the home can’t make money, according to Anderson. The nursing home could make money if staffing, wages, hours and benefit packages are set to industry standards, he explained. According to Anderson, Lakeview Home can gain efficiency without impacting care too much.
Anderson believes Lakeview Homes has tremendous value if offered up for sale and suggested that the City seriously think about opening it up to competitive bids if serious about selling.
According to Johnson, the City hasn’t yet considered competitive bidding because it was simply approached by developer Mick Montag of Mankato. Montag has provided the City with a proposal to purchase Gaylord Lakeview Homes. He is also proposing the construction of a senior housing campus in east Gaylord.
Montag, at last week’s City Council meeting, said his objective is to start construction on the senior housing campus this fall. But, he understands the City can’t rush through this process.
According to City Council member Roger Bruellman, it cannot be business as usual for Gaylord Lakeview Homes. He believes the City needs to protect its profit along with serving the residents to the best of its ability. Bruellman labeled Montag as a very reputable developer who has the best interest of Gaylord in mind.
According to Mayor Doug Quast, the City is trying to shore up and expand health care in Gaylord. He views Montag’s proposal as a positive opportunity for Gaylord.
The City is expecting to receive a final report from Pathways Health Services later this week, according to City Administrator Johnson. That report and Montag’s proposal will then be reviewed by a negotiating committee which may have a recommendation for the City Council at its July 5th meeting.
