After 27 years in the seniors housing business, our friend Brenda Bacon finally decided it was time to move on from the company she founded in New Jersey in 1996. The 31-community Brandywine Living, with communities in New Jersey (20), Pennsylvania (5), Delaware (2), New York (2) and one each in Connecticut and Maryland, was sold earlier this month to Retirement Unlimited Inc. (RUI). Based in Roanoke, Virginia, RUI manages 28 communities across the East Coast and is controlled by the Fralin (third generation) and Waldron (second generation) families. Brenda will continue to manage the two New York communities until the state approves the license transfer.
Welltower owns 29 of Brandywine’s properties with 2,704 units, with a 99.4% interest in the real estate in a RIDEA structure. The REIT also had a minority position in the management company. This all came about several years ago when the previous management at Welltower restructured the relationship. And let us just say, the former CEO, Tom DeRosa, used to sing Brandywine’s praises on quarterly earnings calls, describing it as one of his best operators, if not the best, with the highest unit rates, highest operating margins and highest RevPOR levels in Welltower’s portfolio. He actually gushed, which is a testament to what Brenda built up in some of the best markets in the country.
While we are sorry to see her leave us, she leaves with an incredible legacy, which includes being inducted into the Seniors Housing Hall of Fame and being a past president of Argentum. Not to mention all the lives she touched at Brandywine, employees and residents included. But putting in 14-hour days was getting a little too much, and after successfully pulling her company out of the pandemic, it just seemed like a good time.
Like everyone else, census suffered during the pandemic in the hard-hit Northeast, bottoming at about 74% from about 90% before COVID hit. It has mostly recovered but two new buildings are keeping the overall census from peaking until they stabilize. It shouldn’t take long with little new competition in Brandywine’s markets. And, like everyone else, next up will be margin improvement. But that will be up to RUI, and with average RevPOR of $9,400, which is after the 10% Medicaid waiver requirement in New Jersey, they have a good base to start from.
