Selling your Skilled Nursing Facility (SNF) is one of the most significant decisions you will make. For owners in Milwaukee, the current market presents a complex mix of real opportunity and significant challenges. Navigating this landscape requires more than just finding a buyer. It demands a clear understanding of your practice’s value, the active M&A trends in Wisconsin, and a strategy to address the pressures of staffing and regulations. This guide provides the insights you need to start planning your successful transition.
Curious what your practice might be worth in today’s market?
Market Overview
The market for Skilled Nursing Facilities in Milwaukee is a story of contradictions. On one hand, the broader nursing care industry in Wisconsin is projected to see financial growth. On the other hand, owners are grappling with on-the-ground realities that paint a more challenging picture.
A Market of Contradictions
The most significant headwind is staffing. The caregiver vacancy rate in Wisconsin skilled nursing facilities was reported at 31.2% in 2022, a number that creates daily operational and financial pressure. This issue exists alongside projections for industry-wide revenue growth, creating a complex environment where financial opportunity is directly tied to operational excellence. For a potential buyer, how you manage staffing is a primary indicator of your facility’s health and future potential.
Your Local Competitive Edge
The Milwaukee metropolitan area is home to approximately 57 SNFs. Within this group, 14 facilities have earned a 5-star overall rating. This concentration of high-quality providers means that buyers in this market are accustomed to seeing excellence. If your facility has a strong record of care and positive ratings, it is a powerful asset that can differentiate you from the competition and command a premium valuation.
Key Considerations
Beyond the broad market data, a buyer’s interest will focus on the specific health of your facility. When preparing for a sale, you should view your practice through the eyes of a potential acquirer. They will be looking closely at your ability to manage the industry’s biggest challenges. New federal mandates, like the CMS requirement for 3.48 total nurse staffing hours per resident day, are now a critical part of due diligence. Your ability to meet or exceed these standards is no longer just a quality metric; it’s a core component of your business’s value. Similarly, your facility27s financial performance under current Medicaid rates and your strategy for maintaining quality of care will be scrutinized. A documented history of quality and compliance is one of your most persuasive selling points.
Proper preparation before selling can significantly increase your final practice value.
Market Activity
The transaction market for SNFs in Wisconsin is not just active; it’s moving at a rapid pace. This is not a hypothetical future trend. It is happening right now, creating a clear window of opportunity for owners who are prepared to act.
More than a third of all nursing homes in Wisconsin have been sold since 2016, with a notable trend of facilities transitioning from public to private ownership. This high volume of activity indicates strong buyer interest and available capital.
Recent Market Signals
- High-Profile Local Sales: In December 2024, Berkadia announced the successful sale of three upscale senior living communities located in the greater Chicago and Milwaukee areas, showing strong interest in top-tier regional assets.
- Significant Capital Investment: In January 2025, CIBC Bank USA provided a $67 million loan to finance the acquisition of five SNFs and refinance 21 other facilities across Wisconsin. This demonstrates that lenders are confident in the market and ready to fund major transactions.
This level of activity proves that well-run facilities in the Milwaukee area are highly sought after.
Sale Process
Selling your practice can feel like an overwhelming process, but it can be broken down into a few key stages. The journey typically moves from Preparation (organizing financials and operations), to Marketing (confidentially identifying and approaching the right buyers), to Negotiation (structuring the terms of the deal). However, the most critical phase where many sales face unexpected hurdles is Due Diligence. During this stage, the buyer and their team will conduct a deep dive into every aspect of your facility. They will verify your financial records, check your state and federal regulatory compliance, assess your staffing model, and investigate your reputation for quality. Being thoroughly prepared for this intense scrutiny is the key to preventing delays and ensuring a smooth path to closing.
The due diligence process is where many practice sales encounter unexpected challenges.
Valuation
Understanding what your Skilled Nursing Facility is worth is the first step in any successful sale. Buyers today don’t use simple formulas. They perform a deep financial analysis to determine a practice’s true earning power. The key metric they use is Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). This involves taking your reported net income and adding back owner-specific or one-time expenses to reveal the core profitability of the business.
That Adjusted EBITDA figure is then multiplied by a number that reflects the market’s perception of your facility’s risk and potential. For an SNF in Milwaukee, several factors drive this multiple up or down.
| Factor | Drives Value Up | Drives Value Down |
|---|---|---|
| Staffing Stability | Low turnover, fully staffed shifts, clear compliance with new CMS rules. | High vacancy rates, reliance on expensive agency staff. |
| CMS Star Rating | Consistent 4 or 5-star rating. | History of low ratings, recent compliance issues. |
| Financial Health | Strong profit margins, diverse payer mix, clean financial records. | Heavy reliance on Medicaid, declining occupancy, messy books. |
| Regulatory Standing | A clean survey history with no major citations. | History of citations, ongoing investigations. |
A comprehensive valuation doesn’t just give you a number. It tells the story of your practice in a way that sophisticated buyers understand and value.
A comprehensive valuation is the foundation of a successful practice transition strategy.
Post-Sale Considerations
The day the sale closes is a milestone, but it is not the finish line. Planning for what comes next is just as important as negotiating the deal itself. Your focus should be on three key areas. First is your legacy and staff. A well-structured transition plan can help ensure the team you built is protected and that the quality of care your facility is known for continues. This is often a key concern for sellers looking to protect their reputation in the community. Second are the deal terms. The structure of your sale, including potential earnouts or rollover equity, will directly shape your financial outcome and potential involvement after the transaction. Finally, the tax implications of a sale are significant. How the deal is structured can dramatically impact your net proceeds. Advance planning with an experienced advisor is critical to maximizing what you take home. A great partner helps you plan not just for the sale, but for your life after the sale.
Every practice sale has unique considerations that require personalized guidance.
Frequently Asked Questions
What are the key market conditions affecting the sale of SNFs in Milwaukee, WI?
The Milwaukee SNF market is a mix of financial growth but operational challenges primarily due to a high caregiver vacancy rate of 31.2% as of 2022. While revenue growth is projected, managing staffing is crucial, and quality ratings heavily influence buyer interest and valuation.
How does staffing impact the valuation of a Skilled Nursing Facility in Milwaukee?
Staffing stability greatly influences valuation. Facilities with low turnover, fully staffed shifts, and compliance with CMS staffing rules (like 3.48 nurse staffing hours per resident day) are valued higher. High vacancy rates and reliance on expensive agency staff drive value down.
What financial metrics do buyers use to evaluate the worth of an SNF practice?
Buyers focus on Adjusted EBITDA, which reflects earnings before interest, taxes, depreciation, and amortization, adjusted for owner-specific or one-time expenses. This figure is then multiplied by a risk and potential factor to determine the practice’s true earning power.
What are the main stages in the SNF sale process in Milwaukee?
The sale process includes Preparation (organizing financials and operations), Marketing (confidentially identifying and approaching buyers), Negotiation (structuring deal terms), and Due Diligence, which includes thorough verification of finances, compliance, staffing, and reputation.
What should SNF owners in Milwaukee consider for post-sale planning?
Post-sale planning focuses on legacy and staff retention, deal terms (including earnouts and equity rollovers), and tax implications. Effective transition plans protect the facility’s care quality and reputation, while carefully structured deals maximize financial outcomes and prepare owners for life after the sale.
