Nick Stahler, Michael Mooney and Hap Knowles of the Knapp-Stahler Group at Marcus & Millichap closed the sale of a senior care campus in Los Alamitos, California. The campus includes a 150-bed skilled nursing facility (Alamitos West Health and Rehabilitation) and a 68-unit/140-bed RCFE (Katella Senior Living Community). The skilled nursing component serves as a natural feeder to the RCFE, enhancing resident retention and streamlining care transitions.
The buyer was a joint venture between CareTrust REIT and a third-party healthcare real estate owner. The acquisition presents an advantage to the joint venture through economies of scale, operational synergies and opportunities to leverage ancillary services revenue. The skilled nursing component sold for $23.1 million, or $154,000 per bed.
At closing, CareTrust provided a combined common equity and preferred equity investment totaling approximately $24 million at an initial contractual yield on its combined preferred and common equity investments in the joint venture of approximately 9.7%. The joint venture has leased the campus to affiliates of The Ensign Group pursuant to a new 15-year triple-net lease that includes two, five-year extension options and annual CPI-based escalators. It took the California DHS 11 months to approve the license under their new guidelines, and after the buyer was non-refundable as of May 1, 2024, Stahler, Mooney and Knowles closed the deal on April 1, 2025.
