Bensalem Blues

There is some work to be done for the new owner of an entrance-fee CCRC in Bensalem, Pennsylvania. Juniper Communities (headed by CEO Lynne Katzmann) purchased the community for $13.65 million, or $38,343 per unit, which is well off its 2005 (yes, 2005) price of $17.35 million, or $48,464 per unit. Back then, the unit breakdown was very similar to today’s, which is currently 279 independent living units, 60 assisted living units and 17 skilled nursing beds. Plus it was operating at a 16% margin with a 95% occupancy rate. While the community’s current operations were not disclosed, we have to assume they have fallen off some given the 21% decline in price. Built in 1981 with expansions in 1990 and 1993, the community consists of 13 interconnecting buildings on 20.5 acres. Juniper financed the purchase with cash from its balance sheet, and has plans to refinance with bank debt at a later date. Additionally, the company has $9.5 million in renovations planned for the next two years. The good news is that the acquisition price point is so low, there should be nowhere to go but up. The bad news is that 13 interconnecting buildings is a competitive problem, unless you are training for a marathon.