Orlando, Florida-based Foundry Commercial has formed a new joint venture with Missouri-based Foster Senior Living to manage, acquire and develop seniors housing communities. The JV will be known as FSL Senior Living Ventures, LLC, and Kevin Maddron, CFO of Foundry Commercial and long-term player in the senior living market (most recently with CNL Retirement) will be leading the charge for the JV. He is well positioned for the role given his CNL background and some work he did with Foster after leaving CNL three years ago.
Foundry Commercial is a real estate services and investment firm that was founded in 2007 and has grown to 350 employees and more than 330 properties under management. They also have a large brokerage team with 80 brokers across the southeast. Foster Senior Living has been a family-owned business that originally got its start in the skilled nursing sector and has since gravitated to seniors housing. As of the second quarter, Foster Senior Living manages 20 communities, mostly in the Midwest. Four of these 20 are new management contracts in the joint venture, located in the Midwest, with a fifth asset coming into it in July that is located in South Carolina.
While the joint venture will be looking to do everything, the initial focus will be on acquisitions, perhaps more on the value-add side of the deal market where there is an expectation that there will be some new developments that run into trouble, over-levered properties that need to be sold and equity investors that may not want to ride out the COVID storm for the next year or two. New management agreements will be looked at when they make sense, while new development will be very selective until the market finds some equilibrium.
In the next three years they can see adding 10, maybe up to 20 new assets under management, but they do not want to grow too big. Being a mid-sized regional player works just fine for them, as Foster wants to maintain its culture, which gets more difficult the larger you get.
