A not-for-profit organization emerged as the highest (and winning) bidder for a stabilized, high-quality assisted living community in Fort Wayne, Indiana, beating out several for-profit buyers in the process. We have not seen many deals with a not-for-profit buyer, but perhaps those that can build scale should do so to avoid the fate of so many not-for-profits that have exited in the last couple of years.
Lutheran Life Villages, a local, faith-based organization that has served northeast Indiana for more than 90 years and operates five seniors housing communities across Fort Wayne and
Kendallville, paid roughly $270,000 per unit for the property. Brightstar Senior Living Fort Wayne was developed by Marquee Capital in 2018 and has been operated by Brightstar since then. It features 41 units of assisted living and memory care on 3.25 acres about eight miles north of downtown Fort Wayne.
Occupancy was strong at around 90% when it was first marketed, and we understand the community boasted healthy operations. Given its vintage, occupancy and geography, we would put the operating margin close to 30%, but not above that figure.
Marquee Capital, the real estate company affiliated with Marcus Investments, LLC, the Marcus’ Family Office, hired Ziegler as its exclusive financial advisor in the sale. Nick Glaisner and Melanie Shaffer of Ziegler conducted a focused marketing process for the community and negotiated pricing that represented a 6% cap rate based on historical cash flow, despite a more recent, but temporary, dip in occupancy. Lutheran Life Villages used a local banking relationship to finance the approximately $11.0 million purchase.
