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Lots of interest in Horace Nye Nursing Home

February 17, 2012
By CHRIS MORRIS - Staff Writer (cmorris@adirondackdailyenterprise.com) , Adirondack Daily Enterprise

Dozens of parties have expressed interest in buying Essex County's Horace Nye Nursing Home in Elizabethtown.

Meanwhile, the county will have to install a new sprinkler system by 2013 to meet a state mandate.

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Prime real estate

Josh Jandris of the Chicago-based real estate investment firm Marcus & Millichap told the Enterprise Thursday that about 35 parties have signed registration forms and accessed data on the nursing home, which Essex County listed last year for a price of about $4.25 million.

"They're coming from all over the country," Jandris said. "California, Florida, Chicago, New Jersey, Philadelphia, obviously New York City. There really is no one group. It's a wide range of buyers."

Sale bids are due by 5 p.m. March 7, according to county Manager Dan Palmer.

Listing the nursing home doesn't necessarily mean the county will sell it. But if supervisors back off the plan, the county will still owe Marcus & Millichap a 3.25 percent commission on $4.25 million, which would be about $138,000.

The listing comes with several conditions set by supervisors. A potential buyer would be required to offer jobs to current employees, and the new owner would have to let existing patients stay.

Jandris said actual bids aren't likely to come in until the last minute.

"Under the terms of a normal transaction, you usually market a property from anywhere between two to four months, and it's pretty free flowing - often times there's not even a bid deadline," he said. "You're marketing it to an indefinite amount of buyers, and everybody is kind of vetting the asset and doing their due diligence on their own time.

"In the case of a county transaction, when you're dealing with a very tight timeline, everybody gets the information all at the same time, and everybody vets the property all at the same time. For the county, there's a finite date. They usually submit the bid right at the bid deadline."

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Sprinkler system

Palmer said a state mandate requires all nursing homes to install a sprinkler system.

"Virtually no older nursing homes have one," he said. "Ultimately, it's another cost we can't afford to do to stay in the business."

The system could cost about $500,000 between the two buildings at the nursing home, Palmer said. At one point, the county was asked to install fireproof ceiling tiles. But the sprinkler system would satisfy that requirement.

Palmer said the system could add an additional cost to the nursing home's sale price.

"If I put the sprinkler system in, I may want to sell it for a higher price," he said. "If I don't put it in, I may be willing to take less because they're going to have to put it in. But the way I looked at it was, if we got it out on the street and got a price, then there would be no confusion among potential buyers as to the potential costs."

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To sell or not to sell?

Some town supervisors, like North Elba's Roby Politi, have argued for years that the county should sell the facility and get out of the nursing home business. During a town board meeting Tuesday night, Politi hammered on that point again, noting that the home runs at an annual loss of about $3 million.

"I've said this all along: Government cannot be in these kinds of health care businesses," he said. "It's not working. We don't do a good job, cost-wise, and if we can privatize these facilities and still provide the same number of beds for the same number of people it's a no-brainer. We have to do it."

Politi said Washington County has decided it wants to sell its nursing home.

Moriah town Supervisor Tom Scozzafava told the Enterprise he still believes the county can offer better care for patients at the nursing home. He cited a 2006 study that said public nursing homes provide better service.

"It's never going to be profitable, but you can't run government all the time like a private business," he said. "I believe that some services we morally need to provide."

Scozzafava said that regardless of whether supervisors decide to sell, the process has been beneficial to the facility. An environmental review will be performed, and some of the nursing home's physical deficiencies have been brought to light, he said.

 
 

 

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