Senior Living Investment Brokerage announced two closings this week, one seniors housing and one skilled nursing. Starting with the SNF, Ryan Saul represented a private California-based owner in the sale of their 71-bed facility in Pekin, Illinois. A regional owner/operator with other facilities in Illinois paid $1.5 million or $21,100 per bed, for the property.
Originally built in 1964, the facility was just 62% occupied at the time of the sale but boasted a 57% quality mix, including a 52% private pay census. Cash flow was negative at the time of the sale on nearly $4.24 million of revenues. The seller had inherited the day-to-day management of the facility from her late husband, but the distance proved to be too much, hence the sale. The local ownership should help operations going forward.
At the time of marketing, only half of the beds were certified for Medicaid, but that was increased during the transition with the goal to increase both overall census and the Medicare census.
Then, at the end of March, Jason Punzel, Brad Goodsell and Vince Viverito closed the sale of a stand-alone memory care community in Beaverton, Oregon (about seven miles west of downtown Portland). Owned by a local individual who will be exiting the industry, the 18-unit (24-bed) community was built in 2018 (a tough time for stand-alone memory care, for sure) and quickly stabilized to 92% occupancy and a 38% operating margin on nearly $1.5 million of revenues.
A regional operator with several communities in California paid $5.2 million, or $288,900 per unit, at a 10.8% cap rate, in order to enter the Oregon market. They will operate it via their management company. Greystone provided the bridge debt to fund the deal, a brave move on their part these days.