Broker makes pitch to sell Hope Creek

Sep. 12--ROCK ISLAND -- County board members heard a pitch during Wednesday's committee of the whole meeting from Marcus and Millichap, the Milwaukee real estate brokerage company that wants to market Hope Creek Care Center.

Board members will vote next week during Tuesday's regular meeting whether or not to approve the agreement with Marcus & Millichap and their recommended list price of $19 million for the county-owned nursing home at 4343 Kennedy Drive in East Moline.

Board members voted in June to sell Hope Creek, which has $12 million in mortgage debt and $7.5 million in short-term loan debt, which includes money owed to the county's general fund.

Ray Giannini, senior marketing director for Marcus & Millichap, called Hope Creek, built in 2009, a state-of-the-art facility and assured it was priced correctly.

"This is very well-designed and I think it will be very attractive to a buyer," Giannini said. "I think a buyer will make it profitable over the course of the next 12 months. They will be paying property taxes. Time is of the essence at this point.

"I see nothing but positives when I look at the facility," he said. "I find this facility to be very sell-able."

Giannini said he expects Hope Creek to be sold within six months.

Although the 140,000-square-foot facility sits on 12.5 acres and is licensed for 245 beds, board member Brian Vyncke said most of the acreage will not be included in the sale.

"I usually ask for a little bit of green space around the facility," Giannini said. "Typically the buyer tends to focus on the business."

Giannini said part of the county's difficulty in managing Hope Creek has been with trying to tackle Medicaid reimbursements on their own. Nursing homes that are part of a larger collective are typically more successful with billing issues, he said.

"Medicare and Medicaid programs have become so complicated, that it is difficult for a standalone owner to navigate," Giannini said. "If someone was able to devote the resources, then efficiencies could come in.

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"I think you've had a great run, but it's time to move on," he said.

Rock Island County Auditor April Palmer gave board members a reality check on the financial status of Hope Creek. She said the lack of timely reimbursement from the state for Medicaid payments has contributed to the facility's debt.

"We would be $3.9 million cash richer if all of that money was paid up," Palmer said. "We are getting further and further behind in all of those costs. Please keep in mind that tax levies are supplementing FICA and Illinois Municipal Retirement Fund (IMRF) for Hope Creek (employees) to the tune of $1.5 million per year."

Board member Rich Morthland thanked Giannini for speaking to the board.

"Thank you for your positivity," Morthland said. "We don't often have positive presentations in this room."

Board member Ken "Moose" Maranda, who voted against selling Hope Creek in June, said Wednesday he was pleased with Giannini's presentation.

"He's the one who is going to be marketing it, so I hope he's got the right buyers who are looking at it," Maranda said.

Board member Angie Normoyle said she found the presentation helpful and "full of really good data. It's something we really need to examine. I was impressed with (Giannini's) knowledge of the market and it's great he thinks there is real potential for it to be a positive for the community."

Normoyle said she would not want to accept less than $19 million for Hope Creek.

"I'd hate to take less than our current (debt) obligation," she said. "It would be optimal if we could retire all of the long-term bonds it took to build it and short-term debt. I'm not excited about (selling) it. It's not my first choice, but we are in a tough spot."

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