An established Seattle-based owner/operator of memory care communities emerged to acquire a 50-unit MC community in Bremerton, Washington whose national owner/operator seller had deemed it to be a strategic outlier. Previously operating as a skilled nursing facility, the building was completely gutted and renovated in 2016 to reopen as essentially a brand-new memory care community in 2017 with 62 beds in 50 units. Each unit has a private bathroom, and the building as a whole is in very good condition with Pacific Northwest design elements.
However, it operated as a private pay community and consistently did not draw a high census, averaging around 66% in the last couple of years, with an operating margin of 15%. A search of the property’s address showed Avamere Family of Companies as the previous owner/operator, which wanted to focus on markets in which they have a larger presence.
We learned that locally-based CarePartners Senior Living was the buyer, with plans to allocate approximately 20% of the rent roll to Medicaid residents going forward. That should quickly improve occupancy and cash flow. CarePartners paid $10.6 million, or about $212,000 per unit. Dan Mahoney of Blueprint Healthcare Real Estate Advisors handled the transaction.
