Opening a Sober Living Facility

[Noah Laker]

Hey BP, I'm a local broker and investor. We found an opportunity to purchase a huge SFR with two kitchens located next to a commercial zone which was previously used as a sober living facility. With a few tweaks to the management structure, and with new leadership, I figure we can greatly increase the revenue. I've lost friends and family to substance abuse so it seemed like an opportunity to do some good and make money in the process.

I negotiated a sweet deal, and was prepared to buy it myself, but a few of my clients expressed interest and I ended up helping two of them form a partnership. So here we are, halfway through escrow period, and I'm very excited to watch this project come to fruition.

Anyone on this platform invest in SL? As long as there is no "healthcare" being provided (medicine, baths, etc) then it's not regulated by the department of health. The City is willing to look the other way as long as your contract is written a certain way. I think I have all of my ducks in a row but I want to hear from other investors who are interested in this model.

Any tips? Horror stories? Wins?

[Alecia Loveless]

@Noah Laker Will you be running the house or leasing it to a company.

If you’re leading it to a company be sure to have in your lease explicit information about who is responsible for what in terms of maintenance.

I work in similar facilities and there is a lot of wear and tear on the property.

Having the tenant be responsible for something like the first $1000 of each maintenance issue, or $500 can be a big help.

My company has gone through 3 dishwashers in the last 12 months and it has been an added expense. If a landlord was responsible for each replacement it would add up quickly.