Haven Senior Investments facilitated the sale of two seniors housing communities in eastern Kansas that total 59 assisted living and memory care units. The purchase price was $3.4 million, or $57,600 per unit. The seller, MorningStar Care Homes, divested one of its seniors housing assets a few years ago and is now exiting the sector to retire with the divestment of these two communities.
The communities were built in the mid-90s and are located about an hour apart. They are in good shape, with not much capex needed. Both struggled during the pandemic, but were stabilized at the time of sale with around 85% average occupancy and positive cash flow. They are mostly private-pay, with some Medicaid. The cap rate was 12%, and top-line revenues were over $3.0 million. The ultimate buyer was Reflections Retirement Resort, a local, family-owned existing owner/operator that was looking to expand its portfolio with acquisitions close to its other assets. Reflections financed the deal through a local commercial bank loan.
Robin Gestal handled the transaction. The biggest challenge was location, as the communities are in a rural part of Kansas, making it difficult to find an operator with nearby properties. Nevertheless, the deal closed with all parties satisfied.
