Asset Relifing - Buildings & Equipment
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Principle Valuation’s asset relifing services for buildings and equipment help healthcare operators and owners accurately reflect the useful lives of their assets. This can allow them to:
- Reduce depreciation expense, thus improving their bottom line
- Accurately reflect the book value of their assets over time, thus strengthening their balance sheet, as well as age/life and debt to capitalization ratios
- Improve their credit rating, allowing them to obtain financing at a lower rate
- Lower insurance costs
- Reduce capital expenditure requirements
- Present a more accurate balance sheet
In conducting these studies, our team of appraisers, architects and other professionals examines records that reflect the cost or value of each structural and non-structural component of the physical property, as well as all equipment. We then combine our expertise with industry guidelines and our in-house database to establish the appropriate remaining life of each component.
Healthcare and seniors housing entities turn to us for building and equipment asset relifing services because:
- They trust that our studies will be accurate and fair, and will be performed in a timely manner
- We have studied the actual lives of more than 500 hospitals, and have learned that actual lives are far longer than industry guidelines suggest
- We have developed an equipment database detailing the historic lives of all hospital equipment
- Our professional staff have specific expertise in both real estate (land and improvements) and equipment
- Analysis for 61 hospitals of a national health system reduced annual building depreciation by more than $50 million
- Analysis for an academic medical center reduced annual building depreciation expense by approximately $6 million and annual equipment depreciation expense by approximately $8 million
- Children’s medical center – Analysis for a children’s medical center reduced annual building depreciation expense by approximately $5 million and annual equipment depreciation expense by approximately $6 million. Additionally, we identified approximately $23 million in unrecorded disposals of equipment
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