Alta Senior Living, with corporate offices in Santa Monica, California and West Palm Beach, Florida, purchased its first senior living community in Florida. Located in Margate, the 175-unit Waterside Landing currently has 175 independent and assisted living units. But 22 units on the first floor will be converted to secured memory care. Alta will spend about $6.5 million on this conversion plus other upgrades to the building.
Waterside Landing was built in 1989 and had partial renovations a few years ago. It has a total of 187,000 square feet, or just over 1,050 gross square feet per unit, which is quite large for that vintage. Currently, the second and third floors are not operational, so occupancy was just 40 residents, and there was no positive cash flow. Consequently, this is a classic value-add acquisition, and at a price of $11.375 million, or $65,000 per unit, there is a lot of flexibility to grow census and increase the value significantly. Even when adding in the $6.5 million Alta Senior Living plans to invest, that takes the basis to just over $100,000 per unit. Even at this level, it is way below average in the market.
Nick Stahler of the Stahler Group of Marcus & Millichap represented the seller in the transaction, California-based PG Fry Properties, Inc. and Thorofare Capital, based in Los Angeles, provided the financing for the acquisition and the renovation.
