Public REITs can sell seniors housing assets too
We’ve read a lot about public REITs shedding their skilled nursing assets, but that’s not all they’re selling. A publicly traded REIT sold a pair of West Coast assisted living communities for $23 million, or $365,079 per unit. There is a 48-bed/24-unit assisted living/memory care community in Corvallis, Oregon, and a 78-bed/39-unit AL community in Citrus Heights, California. Over 93% occupied, the communities earned around $6.5 million in annualized revenues. The buyer, Summit Healthcare REIT, triple-net leased the properties for a term of 10 years to an affiliate of Compass Senior Living. Acquisition financing was arranged by Capital One, and Tim Cobb of Blueprint Healthcare Real Estate... Read More »
The Yankees are coming
Winchester, Virginia was the most fought-over town during the American Civil War, changing hands between the North and South as many as 72 times. Now, in a bloodless affair, a 75-unit assisted living community in town has a new owner (New York City-based Care Investment Trust), to the tune of $9.38 million, or $125,067 per unit, with a 7.4% cap rate. The community has undergone expansions since opening in 1990, including a 35-unit addition in 2008, and today includes 73 AL units and two independent living cottages. Both occupancy and the operating margin can be improved, with both standing at 83% and 22%, respectively. Also, monthly rates, ranging from $2,500 to $2,900 for semi-privates,... Read More »When a Deal Is Not a Sale
Kindred Healthcare (NYSE: KND) and Ventas (NYSE: VTR) have agreed on a plan that allows Kindred to exit the skilled nursing business, or at least mostly. Of the 90 or so SNFs that Kindred still operates, Ventas owns 36 of them and leases them to Kindred. The two companies have agreed that Kindred can purchase the 36 properties for $700 million (current rent is $49 million), or renew the current lease on all unpurchased SNFs through 2015 at the current rent level. If they all get purchased (and then re-sold at different prices) for $700 million, that would come to $160,000 per bed, which strikes us as above market for the Kindred SNFs. Most likely, the price represents a premium that KND... Read More »
Connecticut CCRC Changes Hands
A large for-profit CCRC in North Branford, Connecticut recently sold. Purchased in 2006 by a joint venture between The Shelter Group and Herbert J. Sims & Company for $72 million, 10 years later it sold for approximately $69.5 million. National Health Investors (NYSE: NHI) was the buyer, and its all-in acquisition cost was about $74 million, which included closing costs, various escrows/deposits, and other fees. The CCRC, which has 227 independent living units, 22 assisted living units and 50 skilled nursing beds, was originally developed in the early-1990s in two phases on 88 acres. Occupancy had been on an upward trend and was just over 88% in 2015. NHI will be leasing the community... Read More »Will and The Waters
Going through a life insurance company, Aron Will of CBRE arranged acquisition financing on behalf of a joint venture looking to acquire a 139-unit assisted living/memory care community in Edina, Minnesota. In the affluent suburb of Minnesota, the community was built in 2013 with 97 AL and 42 MC units near a local hospital. Mr. Will worked with a joint venture between an institutional client and The Waters Senior Living in securing a $33.15 million seven-year acquisition loan, with a fixed rate and 18 months of interest-only. Read More »Schedule a demo
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