Two recent CCRC sales prove the point that this market can thrive.
You know one of my favorite refrains by now. CCRCs are not dead. And two recent transactions prove my point. At the end of December, David Reis and his Senior Care Development, together with their equity partner Fundamental Advisors, closed on the sale of The Clare in downtown Chicago. This 338 unit/bed CCRC opened during the Great Recession and was forced to sell for 20 cents on the dollar with occupancy at 34%. Today, occupancy is at 98%, average entrance fees are back to $740,000, and they just sold it to LCS for about $320,000 per unit/bed. Talk about a great return on investment. LCS had been a minority investor and was the manager since 2012. Full details are in this month’s SeniorCare Investor.
And then kicking off the New Year, National Health Investors just signed an agreement to purchase a 401-unit/bed CCRC in the greater Seattle, Washington area, joint venturing with LCS in the deal. It just so happens that LCS was also part of the selling group with Westminster Capital, something that seems to work for them. Occupancy at this community is over 95%, and the purchase price is $133 million, or just over $331,000 per unit/bed.
Not too shabby for a market that is dead.