A newly-opened and quickly-stabilizing assisted living community in the affluent Chicago suburb of Prospect Heights, Illinois sold with the help of Richard Swartz, Jay Wagner and Timothy Hosmer of Cushman & Wakefield. Developed in May 2017 by a joint venture between Oz Real Estate, Grandbrier Senior Living and Pathway to Living (the operator), the community features 69 assisted living and 32 memory care units. Three of the MC units featured a shared shower space between two residents, with each resident having their own bathroom and vanity.
Lease-up was strong (averaging over five net move-ins per month), and by the time of the sale it was just under 70% occupied. With the current lease-up closer to 3.5 net per month, we estimate the community will stabilize early in the first quarter next year. Pathway to Living is staying on as the operator, joint venturing with Virtus Real Estate Capital to acquire the community.
To fund the deal, Aron Will of CBRE secured a $28.13 million non-recourse loan, with a floating rate, five-year term and 36 months of interest only, from a regional bank. It so happens that CBRE was already familiar with the property, having arranged the original development financing. Although no purchase price has been disclosed, we’ve estimated the purchase price for the community to be in excess of $350,000 per unit, a testament to the quality of the construction, the pace of the lease-up and the strength of the Chicagoland market.
