DigitalBridge Group, formerly known as Colony Capital, recently announced it was divesting its healthcare real estate assets in order to focus on its digital infrastructure business. Two of the seniors housing properties have found a new owner with the help of Ben Firestone, Michael Segal and Lauren Nagle of Blueprint Healthcare Real Estate Advisors.
The two communities, located in the Kansas City, Kansas MSA, were built in the early 2000s but have received subsequent renovations. Leawood Gardens is a 70-unit assisted living/memory care community in Johnson County, and Blackhawk Assisted Living has 48 units of AL and MC in Miami County. According to our M&A database, Northstar Healthcare (which eventually merged with Colony Capital) acquired the properties from Advantage Health Group in 2013 for a combined $15.6 million, or $132,200 per unit.
Historically, occupancy had been above 90% before a 2017 operational transition to a West Coast-based national assisted living manager. A series of unexpected community-level leadership turnover and units taken offline for major capital improvements caused occupancy to drop. Monthly rates eventually followed. Performance started to climb back up in 2019 and kept rising through 2020, at which point ownership engaged Blueprint to market and sell the communities as value-add opportunities. A growing regional operator was the winning bidder and ultimately partnered with an East Coast-based equity provider to help close the transaction.
