The ADA question killed the margin on a concierge and transport service

The vehicle lease prohibiting a lift retrofit is the detail I'd never have thought to check. Was that a standard clause or specific to that lessor?

I'm a few deals in and hitting a ceiling on exactly this kind of thing, where the model works until one predictable subset of users costs five times the average.

Lantern, 38 accessible trips in month seven. What was that as a share of total trips? Because if it was 38 out of 400 you had a 9 percent cohort costing you 47 percent of revenue, and that ratio is the number to put in the next bid.

This is scope creep with a different hat on. On the renovation side the version I see is a unit turn where one bathroom needs a grab bar and then the whole layout doesn't clear a walker and now you're moving a wall.

The thing that stands out is that you found out in month four. Nothing changed in month four. Those residents were there when you signed. Did nobody at the operator mention the resident profile, or did you not ask for it?

@harrow that's the question. Lantern, did you get a resident roster or any aggregate mobility data during the bid? I'm building a list of things to ask for on service bids and "aggregate resident mobility profile" was not on it until now.

I've been researching for six months without closing anything, and the thing I'm taking from this is that "independent living lite" is doing a lot of hidden work as a label. It sounds like independent living. The residents in it are older and closer to needing support than the marketing suggests, which is the whole point of the hybrid model. So the resident profile of a lite property should be underwritten closer to assisted living than to a 55-plus active adult building.

Lantern, would you agree with that or is that too broad?

@pike I think that's roughly right and it's why active adult and independent living lite shouldn't be priced with the same assumptions even though they get grouped together. Active adult skews mid-sixties, plenty still working. Lite skews well into the eighties.

The renegotiation is the part I'd push on. You went from $47 to $61 and lost the smaller property. Did you consider going to the larger one only and repricing the whole thing, or was the two-property bundle load-bearing for your fixed costs?

Because two shuttles across 345 units is different from two shuttles across 190 units and your per-unit math changes a lot.

I do a lot of due diligence on passive positions and I'd add one thing for anyone reading this from the ownership side rather than the service side.

If you own an independent living lite asset and your transport is outsourced to a vendor who priced it wrong, you're going to eat that eventually. Either the vendor renegotiates like lantern did, or they cut service quality, or they walk. All three show up in your resident satisfaction and then your renewals. When I look at these deals I now ask how long the current service contracts have run and whether the vendor has ever repriced. A vendor two years into an unrepriced contract is a risk sitting on the operating statement where nobody's looking.

Lantern, the $58k is the visible cost. Did the service quality dip during the months you were subsidizing, and did the operator notice?