JD Stettin of Carnegie Capital could not get enough of Texas this month, closing two loans for skilled nursing facilities in the state before attending the NIC Conference in Dallas. Both loans facilitated acquisitions of the facilities. In one, Stettin arranged the assumption of a HUD loan on a 120-bed SNF in west Texas, which carries a sub-3% rate and represented 75% of the purchase price.
The same seller also divested a 150-bed SNF in west Texas, after its relationships with local admissions sources faded over the last year. That led to a substantial decrease in the Medicaid census and cash flow, and upon closing the acquisition, the facility’s EBITDAR was negative, excluding QIPP income. Carnegie secured acquisition financing from a regional bank for 70% of the purchase price. The loan has a five-year term and a three-year declining prepayment penalty.
The incoming operator brings experience and a sizable presence in the state, which should help turn around operations and improve referral networks. They have recently started acquiring their own portfolio. Zak Klein and Craig Kelly of Westgrove Capital Advisory Group handled both sales.
