Did the gap on a straight 12-month note at 14 percent and the operator covered rent from month two. What's the fastest anyone here has seen a fresh RAL stabilize once the license was already in hand?
Saw a 6-bed in Akron stabilize in 47 days from first resident to full house. Operator already had a waitlist before the license cleared, which is the real variable nobody talks about enough. We came in on the capital side of that one at 13.5 on a 9-month note and the refi happened before month seven. The waitlist piece is what separated that deal from every slower one I've watched drag into month four or five still half-empty.
What state was the operator already licensed in before you closed?
Fourteen percent on a 12-month note with the operator covering by month two only works when the license was already in hand before close, and most gap lenders never bother to verify that before they wire. The arrangement that reliably fails is an operator who promises to get licensed quickly after closing. It runs four to six months past the estimate almost every time, and the carry eats whatever margin was modeled going in. Take a 7-bed RAL gap funded on that basis where licensing slipped past close, and the extra carry can consume nearly the entire projected return. The $4,200 net on a Columbus 6-bed is solid. Worth knowing whether the exit is conventional or DSCR on the refi.
The fastest case worth citing is 31 days, a Dayton operator who opened with a waitlist from a closed facility two miles away.
Stabilization on a fresh RAL comes down almost entirely to whether the operator has a waiting list before the doors open, and the license timeline matters far less than people expect. Take a house in Zanesville where the operator opens with no list: it takes about four months to fill six of six beds and cash flow is ugly until month five. Compare a house outside Chillicothe where the operator brings three residents over from a facility that is closing, with the license already transferred, and hits 83 percent occupancy inside three weeks. That second house never really has a stabilization period in the traditional sense. It simply starts. The number that decides everything is the referral pipeline the operator walks in with. Rural markets especially, because you are not pulling from a huge local population, so you need an operator who already has discharge planner relationships at the regional hospital or has families on a waitlist from a previous house. What does the operator's existing referral network look like, and did they have any committed residents before your closing date?
Columbus timing is hard to beat on a licensed RAL. The piece that catches a gap lender off guard on a first deal is operator cash reserves, because a license in hand means nothing if the operator is thin on working capital and starts slow rolling rent the moment one bed sits empty for three weeks.
Six beds with a pre-licensed operator is close to the fastest fill path available in this asset class, because it skips the 60 to 90 day credentialing lag that undoes most projections. The $4,200 net against a gap note is a clean outcome, though the number worth knowing is what the refi LTV landed at once the property appraised as a going concern versus residential. That spread between the two valuations is where a lot of RAL deals either stall or get genuinely interesting. The variable worth checking before anyone funds the next one of these is whether the operator already had referral relationships with discharge planners in that metro on day one, because that is the factor that separates a 45 day fill from a 120 day fill more reliably than anything else in the file.
