A portfolio of five skilled nursing facilities in northern California found a new operating tenant thanks to Nick Stahler of The Knapp-Stahler Group of Marcus & Millichap. Located around the Sacramento area, the facilities feature more than 300 beds and are owned by a private family office. They were originally leased to a regional skilled nursing operator, but that operator was primarily focused on the Southern California market. Operations actually improved slightly during the pandemic due to a higher Medicare census and the three-day stay waiver. But occupancy and expenses did worsen over the last two years. At close, occupancy was 82% with a 28% quality mix.
A new regional operator with a larger presence in Northern California was selected to lease the portfolio at a lease rate of $625 per bed, or above the asking rate and previous rate, and $1.5 million in key money. They plan to invest in significant capex to help drive occupancy and NOI.
