JLL Securities and JLL Capital Markets arranged $79.32 million in tax-exempt, floating-rate bank financing for Integrated Senior Foundation‘s acquisition of three well-performing seniors housing communities in Oregon (2) and Montana. JLL secured a low spread bridge loan, financing the acquisition at 103% loan to cost. The JLL Securities team was led by Greg Fawcett as placement agent, and the JLL Capital Markets Seniors Housing team was led by Senior Director Alanna Ellis and Associates Alex Sheaffer and Erik Cassella.
The three assets collectively comprise 155,058 square feet and feature 287 units, including 23 independent living, 190 assisted living and 74 memory care units. They are stabilized with strong cash flow and operating margins. The borrower paid $77.8 million, or $271,100 per unit.
Built in 1996 and renovated in 2020, Magnolia Gardens is in Cottage Grove, Oregon, with 101 independent living, assisted living and memory care units on a 5.02-acre plot. The community was 96% occupied at the time of sale. Built in 1997 and renovated in 2023, Wiley Creek is in Sweet Home, Oregon, on 6.87 acres with 108 independent living, assisted living and memory care units. It is 96% occupied. Built in 2001 and renovated in 2022, The Lodge is in Great Falls, Montana, with 78 assisted living units on 5.06 acres and was 92% occupied.
Jason Punzel, Vincent Viverito, Brad Goodsell, Jake Anderson, and Taylor Graham of Senior Living Investment Brokerage handled the sale of this portfolio, which was divested by a regional owner/operator that developed and recently remodeled the communities and will use the proceeds to expand its portfolio. Occupancy was strong, averaging 95%, and we believe the operating margin was close to 35%. That healthy performance, combined with the communities’ age, could put the cap rate close to 8%, based on our estimate.
