60 Seconds With Swett: Judging the Mood of Next Week’s NIC Conference
Next week is NIC’s Fall Conference in Washington, D.C., and we are curious to see just how inflation, rising interest rates and general economic uncertainty will affect the mood of the many dealmakers in attendance. We are on track to break a record for total transactions announced in a year, and only an especially slow fourth quarter would prevent that from happening. Given how much capital is out there for higher yielding assets (compared to multifamily that is), and the fact that rates are still historically low for now, we think we’ll break that record. There will just be a little more conservatism in most buyer’s bids and from their lending partners, which is not a bad thing. The... Read More »60 Seconds With Steve Monroe: In Memoriam: Bill Sheriff
We learned two days ago that our friend Bill Sheriff passed away over the weekend. We lost a true gentleman and a true leader in the seniors housing industry. Not many people knew Bill well, as he was a quiet, but thoughtful, man. Known to be a man of few words, I had the honor of sitting down with him, one-on-one, for a four-hour interview for ASHA’s Entrepreneurial Spirit of Seniors Housing series. And yes, it did last four hours, and yes, he did most of the talking. I had known Bill for a few decades, but mostly short conversations at conferences or on the phone. But when you spend four hours with someone, starting with when they were born all the way to the present day, with many... Read More »60 Seconds With Swett: Interest Rate Concerns Cooling M&A Market
In the last couple of months, we have heard from a number of people in the dealmaking business that rising interest rates have caused their potential buyers to hit pause, and a couple of major investors even said that pencils were down for the time being. We can’t say we’re surprised, given where wages have gone and what other issues inflation has caused. And if future earnings are affected by permanently higher labor costs alone, then the higher debt payments caused by higher rates really won’t cut it for those buyers. We have also heard that bid-ask spreads were widening, which will affect transaction volume. The terms “bid-ask spread” and “pencils down” conjure up memories of the worst... Read More »60 Seconds With Swett: SNF Values Soar Post-Pandemic, AL Falls
We continue to observe the post-pandemic senior care M&A market with curiosity, with many crosscurrents of headwinds and tailwinds to make sense of. And our most recent valuation statistics, which includes prices and financials both publicly announced and confidentially disclosed to us, shed some light on the currentmarket.First, the average price for skilled nursing facilities in the last four quarters soared 19% to $118,600 per bed from $98,000 per bed in calendar year 2021. Taking out the exceptionally high estimated price for Stonerise Healthcare’s SNFs, we still see the average price rising above $100,000 per bed for the four-quarter period. With more facilities coming up for sale... Read More »60 Seconds with Steve Monroe: Brookdale Has Great Start To Third Quarter
Brookdale Has Great Start To Third Quarter Nearly two years ago, we wrote that the first half of every year was a census downer for the industry, but that the third quarter was always a winner. We are making history, or better said, you are making history. The first half of this year has been a winner, which it should have been because of the COVID recovery. But census should have been growing faster, held back in part by the labor supply problems and lingering COVID outbreaks. Month-end occupancy for Brookdale Senior Living increased by 210 basis points in the first half of 2022, and then got a great start for the third quarter with a 50-basis point increase in July. The weighted average... Read More »Schedule a demo
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