Redwood Senior Living, a growing assisted living provider based in the Bay Area and run by Anthony M. Barbato, announced that it doubled its portfolio in one day, closing escrow on two properties at the start of February to bring its total portfolio to four communities. Redwood secured lease-option-to-purchase agreements from two separate mom & pop sellers in California.
The Santa Rosa property was built in the 1970s before being taken over by the current seller in the late-1990s. It features 22 beds in 11 units, including a hospice waiver on five beds. Another mom & pop acquired the 21/unit/41-bed Bakersfield community (also built in the 1970s) in the early 2000s. The community is approved for 20 hospice waivers. Both were around 75% occupied and featured an all-private pay census.
The Santa Rosa property had entered into a contract with the California Department of Social Services to receive $300 per diem for every empty bed set aside to care for covid-19 positive individuals. Beds with covid-19 positive individuals placed under a state contract would receive a $700 per diem payment.
Redwood will invest in cosmetic upgrades at both locations in addition to improving the census, cash flow and overall management of the communities. Redwood will also continue to offer hospice services in Santa Rosa and Bakersfield. The purchase price comes to $5.0 million for the Santa Rosa community and $3.39 million for Bakersfield. To finance the acquisition of the real estate, Redwood obtained seller notes and will look to round out the capital stack with 50% LTV first position debt. If you’re interested in providing that debt, contact Anthony M. Barbato at 415-810-0145 or anthony@redwoodseniorliving.org.
