Assisted Living Feasibility Study Case Study: A 159-Unit Assisted Living and Memory Care Proposal in Alpharetta, Georgia That Is Not Feasible as Proposed

A 159-unit assisted living and memory care community on 8.5 acres on Davis Drive in Alpharetta, the program the City approved in its 2022 rental housing study, tested in a metro that ranks second lowest of the 31 NIC MAP Primary Markets at 86.5 percent occupancy and in a city that already holds 1,651 senior rental units. At a total project cost of $65,699,500 the community covers its construction debt 0.69x at a stabilized occupancy of 86 percent and needs 94.4 percent occupancy to cover at 1.0x; the agency take-out supports $24.5 million against a $42.7 million construction loan. Not feasible as proposed. Feasible as resized to a 66-unit memory care-led community of 30 assisted living and 36 memory care units on 3.5 acres of the site, at 55 percent of cost, covering 1.29x in Year 3 and 1.49x in Year 5.

Model study prepared by MMCG Invest | Michal Mohelsky, J.D., FMVA | October 1, 2026

MMCG concludes that the 159-unit assisted living and memory care community proposed for the Davis Drive site in Alpharetta, Georgia is not feasible as proposed. At a total project cost of $65,699,500 and a bank construction loan of $42,704,675 at 65 percent of cost, the community does not cover its debt in any of its first five years, reaching 0.69x at a stabilized occupancy of 86 percent in Year 4 and 0.74x in Year 5, and it would need 94.4 percent occupancy to cover at 1.0x in a metro whose senior housing occupancy stands at 86.5 percent. The agency permanent lenders that would take out the construction loan size to 1.40x coverage for assisted living and 1.45x for memory care, which on the Year 4 cash flow supports about $24.5 million against the $42.7 million the construction lender would be owed, a gap of $18.3 million that no lease-up schedule closes. The causes are structural rather than operational: Alpharetta already holds 1,651 senior rental units in 14 properties with 250 more assisted living units approved, the Atlanta metro added a third to its inventory between 2017 and 2022 and has not recovered, the Georgia assisted living median fell to $5,300 per month in 2025 while the national median rose 5 percent, and Atlanta's licensed nursing wages run 20 percent above those of the Midwest markets in MMCG's other model studies.

The site supports a different project. A 66-unit memory care-led community of 30 assisted living and 36 memory care units on 3.5 acres of the parcel, at a total project cost of $22,818,000 and a construction loan of $12,549,900 at 55 percent of cost, covers 1.29x at a stabilized occupancy of 90 percent in Year 3 and 1.49x in Year 5, and its Year 3 cash flow supports an agency take-out of $13.2 million at 1.45x, above the construction loan. That program is feasible, conditioned on confirmation from the City of Alpharetta of the current status of the Heritage Park and Village Park Phase 2 entitlements, which together total 250 approved assisted living units and which change the supply arithmetic in opposite directions depending on whether they are built or lapsed, and on a pipeline check of Alpharetta, Johns Creek, Milton, Roswell and Cumming planning records for 2025 and 2026.

This is an MMCG model study: a complete feasibility analysis performed on a real, city-approved program using public data, prepared to show lenders and sponsors how MMCG reaches and documents a determination of not feasible as proposed, and what a feasible resizing looks like. It is not a client engagement, MMCG has no relationship with the developer of the Heritage Park project, the landowner or the City, and the analysis does not represent an offer, an appraisal or a recommendation. The 159-unit program on 8.5 acres on Davis Drive is taken from the City of Alpharetta's Rental Housing Study Update of June 2022, which listed it among approved projects not yet built; its status in 2025 and 2026, its developer and any permits were not confirmed at the study date, and no 2023 to 2026 record of the project surfaced in city records or local press. The study therefore treats the program as the as-proposed case to be tested, and a client engagement would begin by confirming whether the entitlement is active, lapsed or built. The land is carried at an allowance of $600,000 per acre (MMCG assumption) because no listing was anchored. The competitors' licensed capacity and category from the Georgia Department of Community Health, their unit split and their rates from their own websites were not confirmed at the study date, and the Atlanta metro's current construction share, deliveries and absorption are subscriber data not available to this study; all are disclosed limitations.

The Project as proposed would operate as a licensed Georgia assisted living community with a certified memory care unit on 8.5 acres on Davis Drive in Alpharetta, Fulton County, Georgia, in the north Fulton submarket that includes Alpharetta, Milton, Johns Creek and Roswell. The physical program comprises a three-story, 140,000 SF wood-frame building over a podium with 119 assisted living apartments (50 studios of 420 SF, 55 one-bedroom units of 580 SF and 14 two-bedroom units of 800 SF) and a 40-unit secured memory care wing of 350 SF studios with its own dining and activity rooms and enclosed courtyards, together with a commercial kitchen, a main dining room seating 110, a bistro, a wellness clinic, a salon, a theater, activity and craft rooms, a fitness room and pool, administrative offices, laundry and housekeeping, 140 surface and podium parking spaces and a porte-cochere. The community would operate 24 hours a day with a staff of 98 full-time equivalents. The sponsor is a for-profit development entity with a third-party operator under a management agreement. The Project is positioned in the north Fulton market at an assisted living base rent of $5,100 per month with care levels averaging $1,000 and an all-inclusive memory care rate of $7,600 at opening, against published competitor entry rates of $4,295 to $4,995 in Alpharetta and a Georgia median of $5,300.

The primary market area is Alpharetta, Milton, Johns Creek and Roswell within a 15-minute drive of the site.

Source: U.S. Census Bureau, QuickFacts, Vintage 2025 estimates and ACS 2020 to 2024; City of Alpharetta, Rental Housing Study Update, June 2022.

Alpharetta is one of the highest-income cities in the Southeast, and its demographics are not the problem. The persons 65 and over and median home value for Alpharetta, the Fulton County QuickFacts figures, and the Fulton County population aged 75 to 84 and 85 and over from ACS table B01001 were not pulled at the study date and are disclosed limitations. The study's finding does not depend on them: the as-proposed case fails on supply and on the rate and labor structure at any plausible demand figure, and the demand model is carried for the resized case only.

Atlanta is the second weakest of the 31 NIC MAP Primary Markets. Its senior housing occupancy was 83.7 percent in the third quarter of 2024, among the three lowest; 85.9 percent in the third quarter of 2025; 86.0 percent in the first quarter of 2026, the lowest of the 31; and 86.5 percent in the second quarter of 2026, second lowest after Miami at 86.2 percent and 3.4 points below the Primary Market average of 89.9 percent. The cause is the last cycle. In mid-2017 Atlanta's construction pipeline equaled 17.4 percent of its inventory, 31 buildings and more than 3,333 units, and by the second quarter of 2022 its inventory had grown 33 percent, by more than 6,300 units, with construction still at 7.3 percent of inventory against 5.1 percent nationally. Seven quarters of improvement since late 2024 have brought the metro from 83.7 to 86.5 percent, and at that pace it does not reach 90 percent before 2028, which is when a project starting now would deliver. National supply discipline, with construction at 2.2 percent of inventory and fewer than 16,000 units under construction in the Primary Markets, does not help Atlanta, whose problem is inventory delivered rather than inventory coming.

Alpharetta is where that inventory concentrated. The City's June 2022 study counted 14 senior housing communities with 1,651 units, 21 percent of all units in the city's rental complexes, up from 19 percent, with two assisted living developments of 206 units delivered since 2019 and two more approved and unbuilt: Heritage Park on Davis Drive at 159 units on 8.5 acres and Village Park Phase 2 on Highway 9 at 91 units on 5.0 acres. Forsyth County to the north extended its residential rezoning moratorium through November 17, 2026, which constrains new supply there but also signals the saturation the region's governments perceive.

MMCG identified sixteen assisted living and memory care communities in Alpharetta, Milton, Johns Creek and Roswell within roughly five miles of the site. Unit counts and years opened for the first six are from the City's 2022 study; rates are from directory sources where noted and were not confirmed from the operators' own websites; the Georgia Department of Community Health licensure category and memory care certification for each were not confirmed.

Competitor Number 1 Atria North Point This community is located at 100 Somerby Drive, Alpharetta, GA 30009, opened in 2008 with 282 units of independent living, assisted living and memory care, and is operated by Atria Senior Living. Rates were not confirmed.

Competitor Number 2 Village Park Milton This community is located at 555 Wills Road, Milton, GA 30004, opened in 2020 with 130 assisted living and memory care units per the City study (a directory source lists 272 beds and a 2021 opening), and is operated by Village Park Senior Living. Rates were not confirmed.

Competitor Number 3 Village Park Alpharetta This community is located at 12300 Morris Road, Alpharetta, GA 30005 and is operated by Village Park Senior Living, which states on its website that the main campus is licensed as assisted living; its Phase II added 76 assisted living units on 2.5 acres after 2019. Directory sources list starting rates of $4,375 and $4,995 per month, which conflict.

Competitor Number 4 Inspired Living at Alpharetta This community is located at 11450 Morris Road, Alpharetta, GA 30005, opened in 2017 with 128 assisted living and memory care units, and is operated by Inspired Living. Rates were not confirmed.

Competitor Number 5 Addington Place of Alpharetta This community is located at 762 North Main Street, Alpharetta, GA 30009, opened in 2013 with 79 assisted living and memory care units. A directory source lists Chapters Living of Alpharetta at the same address, which suggests a rebrand; the two are counted once. Rates were not confirmed.

Competitor Number 6 Mayfield Oaks This community is located at 143 Mayfield Road, Alpharetta, GA 30009, opened in 2013 with 13 assisted living units. Rates were not confirmed.

Competitor Number 7 The Mansions at Alpharetta This community is located at 3675 Old Milton Parkway, Alpharetta, GA 30005 and is operated by Mansions Senior Living, with 51 to 75 assisted living and 31 to 50 memory care units per a directory source. A directory source lists a starting rate of $4,795 per month.

Competitor Number 8 The Oaks at Alpharetta This community is located at 253 North Main Street, Alpharetta, GA 30009 and markets assisted living and memory care. A directory source lists a starting rate of $4,295 per month.

Competitor Number 9 The Phoenix at Milton This community is located at 13943 Georgia Highway 9, Milton, GA 30004 with 105 beds per a directory source and markets assisted living and memory care. Rates were not confirmed.

Directory sources also list Legacy Ridge at Alpharetta, The Georgian Lakeside by Cogir, Belmont Village Johns Creek, Sunrise at Five Forks, Arbor Terrace at Crabapple, Brickmont of Roswell and Addington Place of Johns Creek (72 units) in the five-mile ring, none of which was confirmed. Local resistance to new senior care is documented: Milton's City Council halted a 15-bed Cogburn Road senior living application in April 2022, and Roswell declined a rezoning request for a senior facility. No 2025 or 2026 filing for assisted living or memory care in Alpharetta, Johns Creek, Milton, Roswell or Cumming was found at the study date; the search is a condition of the resized determination.

Two state-level facts separate Atlanta from the markets in MMCG's other model studies. The CareScout Georgia median for an assisted living community fell from $5,339 per month in the 2024 survey to $5,300 in the 2025 survey while the national median rose 5 percent to $6,200, and published competitor entry rates in Alpharetta of $4,295 to $4,995 sit below the state median. The as-proposed assisted living base rent of $5,100 with care levels averaging $1,000 is therefore set at the market, not above it, and the sensitivity cases test it lower.

Atlanta's labor is priced at Kansas City parity for aides and well above it for nurses. The May 2025 Atlanta metropolitan wage release places the healthcare support occupational group at a mean of $19.33 per hour against $19.21 in Kansas City, personal care and service occupations at $18.17, and healthcare practitioners at $55.97 against $46.52 in Kansas City and $52.26 nationally. Georgia's state minimum wage of $5.15 is superseded by the federal $7.25 and neither binds. The model pays resident care aides $18.00 per hour, licensed practical nurses $32.00 and registered nurses $47.00 with a 24 percent burden, and the as-proposed labor budget of $5,840,000 at stabilization is 46.2 percent of revenue, against 40.9 percent in the Overland Park model, because the nursing cost is higher and the rate base is lower. Georgia's Community Care Services Program pays assisted living only through alternative living services at a daily rate not retrieved for this study, with the resident's room and board set at $768 per month from January 1, 2026, and the Project is modeled at 100 percent private pay.

In a submarket with 1,651 existing senior units and a metro at 86.5 percent, a 159-unit community does not lease to 90 percent in 29 months. The as-proposed case carries 35 percent average occupancy in Year 1, 62 percent in Year 2, 78 percent in Year 3 and a stabilized 86 percent, the metro average, from Year 4.

Location: Davis Drive, Alpharetta, GA 30004 Size in SF (Gross): 140,000

Source: Marshall & Swift CoreLogic, MMCG

Total project cost of $413,204 per unit sits above CBRE's July 2026 national benchmark of $388,830 because the financial reserve required to carry a 159-unit lease-up in a saturated market is $7,400,000, and even that reserve does not cover the shortfall: the lease-up deficit through Year 5 after debt service totals $14.7 million, and construction-period interest on the loan adds about $2.6 million. The reserve shown is what a sponsor would plausibly budget; the pro forma shows what the Project would actually consume.

Loan Assumptions, As Proposed

The Year 4 operating expense budget of $10,061,448 comprises labor of $5,840,000, dietary raw food of $470,000, utilities of $420,000, repairs and maintenance of $330,000, insurance of $520,000, property tax of $1,030,000 on Fulton County and City of Alpharetta millage (allowance; the millage was not pulled), marketing of $340,000, administrative costs of $480,000 and a 5 percent management fee of $631,448. The stabilized margin of 20 to 21 percent, against 28 to 30 percent in MMCG's feasible model studies, is the arithmetic of a market-rate assisted living product carrying Atlanta nursing wages, and it does not carry debt at 65 percent of cost.

The community would need 94.4 percent occupancy to cover its construction debt once, eight points above the metro, and 1.25x coverage is arithmetically unavailable at full occupancy. The agency permanent lenders size assisted living at 1.40x and memory care at 1.45x on stabilized cash flow after 90 days at 90 percent occupancy; on the Year 4 cash flow of $2,498,016, a blended 1.42x at a 6.00 percent 30-year rate supports about $24.5 million, against the $42.7 million construction loan, a gap of $18.3 million. A construction lender that could not see its take-out at the start would not fund the loan, and that is the determination.

No single assumption rescues the as-proposed program. Even a 90 percent stabilization with rates 5 percent above forecast, both contrary to the market evidence, reaches only 1.00x, and reducing the construction loan to 55 percent of cost, which would require $29.6 million of equity, reaches only 0.82x. The project is too large for its submarket at the rate and labor structure Georgia offers.

The site supports a 66-unit memory care-led community of 30 assisted living and 36 memory care units in a single-story 52,000 SF building on 3.5 acres of the parcel, with the balance of the 8.5 acres held or sold. Memory care leads the program for three reasons: it is the segment in which north Fulton's purpose-built supply is thinnest relative to the 1,651 senior units already built, it carries a rate of $8,100 per month at opening that does not depend on the saturated assisted living price point, and the agency lenders underwrite it on its own coverage. The building, staffing and amenities follow the Overland Park and Kearney model studies at the smaller scale, with a staff of 44 full-time equivalents including a dedicated memory care team and a licensed nurse on every shift.

Location: Davis Drive, Alpharetta, GA 30004 Size in SF (Gross): 52,000

Source: Marshall & Swift CoreLogic, MMCG

Total project cost of $345,727 per unit sits below the national benchmark because the single-story building carries no podium or pool, the land is 3.5 acres rather than 8.5, and the financial reserve of $2,500,000 covers construction-period interest of about $584,000 and a lease-up shortfall of $1,868,438 through the second operating year, a total requirement of $2,452,000.

Loan Assumptions, As Resized

The Year 3 operating budget of $4,415,869 comprises labor of $2,700,000 (46.4 percent of revenue, reflecting the memory care staffing and Atlanta nursing wages), dietary raw food of $215,000, utilities of $170,000, repairs and maintenance of $130,000, insurance of $200,000, property tax of $330,000, marketing of $160,000, administrative costs of $220,000 and a 5 percent management fee of $290,869. Memory care revenue is 59 percent of the total, which is what carries the margin. On the Year 3 cash flow of $1,373,494 the agency take-out at 1.45x and a 6.00 percent 30-year rate supports about $13.2 million, above the $12,549,900 construction loan, so the construction lender can see its exit.

The resized community holds coverage above 1.0x in every single-factor case except a new competitor holding it to 80 percent, and the single-factor cases cluster at 1.02x to 1.04x, which is a thinner cushion than MMCG's Midwest model studies carry and is the honest measure of the Atlanta market even for a well-conceived project. The 45 percent equity requirement, against 33 to 40 percent in those studies, is the price of building in a Primary Market that has not recovered from its last cycle. A phased alternative, building the 36-unit memory care wing first and the assisted living units only after the first phase sustains 90 percent for two quarters, reduces the equity at risk and is the structure a lender would most readily accept.

The determination of not feasible as proposed stands on the evidence above and is not conditioned. The determination of feasible as resized is subject to the following conditions precedent:

The following items could not be verified from a primary source at the study date and are disclosed: the Heritage Park and Village Park Phase 2 status, developer and 2023 to 2026 permits or press; the Georgia Department of Community Health licensure category and memory care certification for each competitor, and whether Addington Place and Chapters Living of Alpharetta at 762 North Main Street are one property; competitor unit counts and rates from the operators' own websites; the Atlanta metro's current construction share, deliveries, absorption and rent growth, and the county concentration of 2019 to 2024 supply; the May 2025 Atlanta wages for home health and personal care aides, nursing assistants, licensed practical nurses and registered nurses from the BLS data tool; the CareScout 2025 Atlanta metro assisted living median; the Fulton County and City of Alpharetta commercial millage; the Community Care Services Program alternative living services daily rate; and the Alpharetta persons 65 and over and median home value, the Fulton County QuickFacts figures and the Fulton County population aged 75 to 84 and 85 and over.

This model study applies the methodology described on MMCG's assisted living feasibility study page. MMCG prepares assisted living feasibility studies for conventional, agency, HUD Section 232, SBA and USDA lenders nationwide, with engagements from $4,900 and delivery in 9 to 16 business days, and feasible as resized and not feasible as proposed are regular outcomes of the practice.