The market for neurological rehabilitation is expanding rapidly. For practice owners in Portland, this presents a significant opportunity. Strong buyer demand and national growth mean that a well-positioned practice can achieve a premium valuation. This guide provides a straightforward look at the Portland market, what buyers are looking for, and how you can prepare for a successful practice transition.
Market Overview: A Tale of Two Trends
Your practice doesn’t operate in a vacuum. National trends directly impact its local value. Understanding both gives you a strategic advantage when considering a sale.
National Growth Signals Opportunity
The market for neurological rehabilitation services is thriving. Globally, the industry is projected to grow at a compound rate of over 8.3% annually through 2030. This growth is fueled by an increasing prevalence of neurological conditions and an aging population. For practice owners, this means one thing: A growing pool of sophisticated buyers, including private equity and strategic health systems, are actively looking for high-quality practices to acquire.
The Portland Landscape
Here in Portland, the demand is clear. The presence of established neurological rehabilitation centers at major institutions like OHSU, Legacy Health, and Providence confirms a robust local need for these specialized services. This environment creates a competitive landscape, but it also proves that Portland is a valuable market. For an independent practice, this means your well-run operation is an attractive target for buyers looking to enter or expand in a proven territory.
Key Considerations for Positioning Your Practice
Buyers are looking for more than just a profitable business. They are buying a stable, well-run operation with clear growth potential. Your value is demonstrated in the story your practice tells. Consider how you present your key strengths: your specialized niche in a high-demand field, the expertise of your loyal therapists and staff, and the reliability of your referral network from local neurologists and primary care physicians. Framing these elements correctly is often what separates an average offer from a premium one. Many owners we work with are surprised to learn that what they consider “business as usual” is a significant strategic asset to a buyer.
What Buyers Are Asking About in Today’s Market
Because specific sale prices for practices like yours in Portland are not public knowledge, buyers rely heavily on their own due diligence to determine value. Getting ahead of their questions is critical. This is not the time to “wing it.” A buyer will want to see a clear, organized picture of your practice.
Here are four areas where serious buyers will focus their attention:
- Financial Health: They will want to see 3-5 years of clean financial statements, tax returns, and a clear breakdown of your revenue, expenses, and profitability.
- Operational Stability: Who are your key staff members, and will they stay? What is your payer mix, and are your insurance contracts favorable?
- Competitive Position: Who are your main competitors in the Portland area? What makes your practice the better choice for patients and referrers?
- Future Growth: What opportunities exist to expand services, add providers, or open a new location? They are buying the future, not just the past.
The Sale Process in Plain English
Selling your practice follows a structured path. While every deal is unique, the journey generally involves four key phases. First is Preparation, where we work with you to gather your financials and craft the story that highlights your practice’s strengths. Second is Valuation, where we determine your practice’s market value. Third is Confidentially Marketing your practice to a vetted list of qualified buyers to create a competitive environment. Finally, we manage Negotiations, Due Diligence, and Closing, guiding you through the final steps to a successful transition. Each step is a project in itself, but a well-managed process protects your confidentiality and your time.
How Your Practice is Actually Valued
One of the biggest misconceptions is that a practices value is based on a simple formula. In reality, sophisticated buyers value your practice based on its Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This figure represents your true cash flow. We find that most practice owners are undervaluing their business because they are looking at net income instead of normalized earnings.
Adjusted EBITDA is calculated by taking your net income and adding back non-cash expenses and owner-related perks that won’t continue post-sale.
| Your Practice’s Numbers | Amount | Explanation |
|---|---|---|
| Reported Net Income | $400,000 | Profit on your P&L statement. |
| Add: Owner’s Excess Salary | +$100,000 | The amount you pay yourself above market rate. |
| Add: One-Time Equipment Purchase | +$25,000 | A cost the new owner won’t have. |
| Add: Personal Auto & Travel | +$15,000 | Expenses run through the business. |
| Adjusted EBITDA | $540,000 | The true earning power buyers will value. |
This final number is then multiplied by a “multiple” (e.g., 5x, 7x) that is determined by your specialty, size, growth rate, and reliance on you as the owner. Getting the Adjusted EBITDA right is the foundation of a successful sale.
Planning for Life After the Sale
A successful transaction goes beyond getting the highest price. It’s about designing a future that meets your personal and financial goals. What happens the day after the check is cashed? It’s important to think about this now. Do you want to walk away completely, or would you prefer to stay on for a period of time? Do you want to retain a piece of the equity and participate in the future growth you helped create? Structures like earnouts and equity rollovers can be powerful tools, but they need to be negotiated carefully. The best deals are the ones that not only secure your financial future but also protect your staff and the legacy you’ve spent a career building.
Frequently Asked Questions
What is the current market outlook for selling a neurological rehabilitation practice in Portland, OR?
The market is expanding rapidly both nationally and locally in Portland, with national industry growth projected over 8.3% annually through 2030. Portland has strong demand indicated by major institutions like OHSU, Legacy Health, and Providence, making it a valuable and competitive local market for neurological rehabilitation practices.
What key factors do buyers consider when evaluating a neurological rehabilitation practice for purchase?
Buyers focus on four main areas: 1) Financial Health, including 3-5 years of clean financial statements and profitability; 2) Operational Stability, such as key staff retention and favorable insurance contracts; 3) Competitive Position, highlighting differentiation from other local practices; and 4) Future Growth Potential, including opportunities to expand services or locations.
How is the value of a neurological rehabilitation practice determined?
Value is based on the practice’s Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), which adjusts net income by adding back non-cash expenses and owner-related perks. This true cash flow figure is then multiplied by a factor (multiple) depending on specialty, size, growth rate, and ownership reliance to determine market value.
What are the typical steps involved in selling a neurological rehabilitation practice?
The sale process has four main phases: 1) Preparation, gathering financials and crafting the practice’s story; 2) Valuation, determining the market value; 3) Confidential marketing to vetted buyers creating competition; and 4) Negotiations, due diligence, and closing, managing the final transaction stages discreetly and efficiently.
What should practice owners consider about life after selling their neurological rehabilitation practice?
Owners should consider their personal and financial goals post-sale, including whether to fully exit or stay involved, possibly through earnouts or equity rollovers. Planning helps secure financial security, protect staff, and preserve the practice legacy. Deciding on these terms in advance supports smoother negotiations and aligned outcomes.
