About the Real Estate: 

• Land – 2,687 Sqft
• Building Area – 12,510 Sqft
• Land Use- Hospital- public
• Property Type – Healthcare
• Number of Stories – 3
• Total Rooms – 44
• Year built – 1906
• Basement- 1
• Garage – 0
• Corner Lot

About the Business: 

This well-established turnkey Adult Residential Facility (ARF) is located in San Francisco and is licensed for 32 beds. The facility has been in continuous operation since 2008, demonstrating a strong history of compliance and stability. Residents are primarily referred through government programs, providing reliable occupancy and consistent revenue supported by Medicare and Medi-Cal. The operation is fully staffed with 9 experienced employees, including administrator, food service, and housekeeping, and night shift staff. The property offers potential for future re-licensing or repositioning, subject to regulatory approval. This is an excellent opportunity to acquire a long-standing care facility with proven performance in a high-demand market. 

The level of care is 1, with residents who have good self-care skills, minimal behavioral issues, and moderate independence.

Compliance History:

The business has had no licensing violations in the past eighteen (18)  years, no citations in the past three (3) years, and zero lawsuits.

Appraisal and Comparison: 

The asking price for the property is $11,000,000, inclusive of all applicable licenses. Upon execution of the NDA, I will provide documentation of comparable sales within the immediate vicinity, including transactions valued at $22,564,000 and $35,896,666. These comparables demonstrate substantial upside potential and highlight the strong investment opportunities associated with this offering.

Business Performance:

Efficient staffing in place with strong labor management and operational balance.  Business financials are not included herein and will be disclosed separately.

Facility:

• Bedroom – 15
• Bathrooms- 1 full, 4 shower rooms, 5 toilets
• Office – 1
• Kitchen -1
• Dining Room – 1
• Recreation Room – 1
• Laundry 1
• Storage – Multiple

Reason for Selling:

Retiring. Death in the family.

Can an ARF (Adult Residential Facility) be converted to an RCFE (Residential Care Facility for the Elderly), an SNF (Skilled Nursing Facility), or a specialized memory care unit?

Yes, converting an ARF (Adult Residential Facility) to an RCFE (Residential Care Facility for the Elderly) or a specialized Memory Care unit is possible in California, but it requires significant steps like zoning checks, retraining staff (especially for memory care), updating business plans, and obtaining new/modified licenses from the California Department of Social Services (CDSS) Community Care Licensing Division. Converting to a Skilled Nursing Facility (SNF) is a much bigger shift, requiring a separate license from the Department of Public Health (DPH). 

Overview

What is ARF (Adult Residential Facility)?

ARF license in California authorizes a facility to provide 24-hour non-medical care, supervision, room, meals, and assistance with daily living (like bathing, hygiene) for adults (18-59) with mental, physical, or developmental disabilities, requiring a certified administrator, specific training, and compliance with state health/safety standards, unlike RCFEs which focus on the elderly. 

Key Aspects of an ARF License:

• Clientele: Adults aged 18-59 (or 60+ under specific rules) with disabilities needing supervision but not skilled nursing care.
• Services: 24/7 housing, supervision, meals, help with personal care, and general support.
• Non-Medical: Focuses on assistance with daily living, not complex medical treatments.
• Regulatory Body: California Department of Social Services (CDSS)(Community Care Licensing Division).
• Administrator Certification: Requires approved training (e.g., 35-hour course) and passing an exam.
• Facility Standards: Must meet state standards for safety, staffing, and operations, including fire safety and menu planning.
• Purpose: To offer a home-like setting for those who can’t live independently but don’t need a nursing home.

In essence, an ARF license allows you to run a specialized assisted living home for adults with disabilities, ensuring quality care under strict state guidelines. 

Who Provides Clients to an Adult Residential Facility (ARF)

Clients for Adult Residential Facilities (ARFs) are primarily provided through government programs. State agencies such as the Department of Developmental Services (DDS) and the Department of Social Services (DSS) fund and coordinate placements for individuals with developmental disabilities and mental health needs.

Eligible individuals are often referred through Regional Centers and programs such as the Assisted Living Waiver (ALW) for Medi-Cal beneficiaries. These programs support the transition of individuals from institutional settings to community-based living and ensure placement in licensed ARFs.

In addition, the state certifies facilities to provide specialized services, including Enhanced Behavioral Support Homes. Through these referrals and funding mechanisms, ARFs provide residents with 24-hour non-medical care, supervision, and supportive services in a safe, community based environment.

Primary Payment Sources:

Adult Residential Facilities (ARFs) get paid through a mix of private payments, government programs like Medi-Cal (medicaid) especially through waivers like the Assisted Living Waiver), and SSI (social security income) from residents, often supplemented by state/county “patches” or enhanced funding for mental health services. 

Additional Funding & Subsidies:

• Government Subsidies (“Patches”): Because resident SSI/SSP often isn’t enough for ARF operations, state or county funds (like “patches”) are crucial, especially for facilities serving mental health clients.
• Enhanced Funding: Larger facilities serving mental health residents can get more county revenue and enhanced funding for more robust services (dietary, activities, etc.).
• Medicare & Managed Care: Can also contribute, but often less so than Medi-Cal for residential care. 

Assumption Earnings 2026:

Low Level of Care: Level 1

Total Census: 32

Monthly Rates: $1,444.07 SSI

Daily Patch: $47 daily (increase every half year)

Government Grants: $20k

Monthly Gross Income: $92,420.48

Yearly Gross: $1,129,045.76

NOI: About $400k

Typical Monthly Revenue (per resident)

• Low level of care: $2,500–$4,000

• Moderate level of care: $4,000–$7,000

• High level of care / specialty: $7,000–$10,000+

Expenses

Labor/Payroll

Food and Supplies

Cleaning Supplies

Utilities

Licensing and Certification

Insurance

Rent/Mortgage

Maintenance