Deals Down So Far in 2017
Long-term care has experienced a dip in M&A, but after nearly three straight years of 80+ transactions per quarter (starting in Q3:2014 with 83), with a couple exceptions, it is about time the M&A juggernaut slows down a bit. The first quarter’s volume fell to 76 deals, down from 93 in the previous quarter and from 84 in the year-ago quarter. And as of May 23, 2017, deal volume has so far not kept pace compared with the same period in 2016 with just 118 long-term care transactions recorded compared with 145 in 2016, a 19% difference. However, spending has nearly doubled (to $7.52 billion so far in 2017 from $4.37 billion in 2016), thanks to a few large deals that were announced in... Read More »
To Settle Or Not to Settle
Sometimes, when people search for problems at a senior living provider, it just gets absurd. I read this week a story in McKnight’s about a senior living provider who was sued and settled on a payment of a few hundred thousand dollars for the “crime” of not having sign language interpreters available. My reaction was, you’ve got to be kidding! No one had asked for sign language interpreters, but apparently someone went in “undercover” and found out they were not available. Imagine that. Obviously, I have nothing against the deaf, and my hearing is beginning to go, but to be coerced into forking over a few hundred thousand dollars for not having a service that was not asked for, well, this... Read More »
Expense Ratios: Independent Living Vs. Assisted Living
When comparing the independent living and assisted living markets, one would expect IL communities to operate at a higher margin than AL, given its lower services and thus, costs. And while that remained true in 2016, independent living and assisted living expense ratios came as close to equal as any time in the past, at 69.5% and 72.5%, respectively, according to the 22nd Edition of The Senior Care Acquisition Report. Only in 2011, when independent living had a higher expense ratio than assisted living, by just 10 basis points, did the two sectors operate more similarly. The shift has been steady, with the spread between IL and AL expense ratios of properties sold sharply decreasing from... Read More »
Is Brookdale Prepping For The Sale?
As you may know, we were never a fan of Brookdale Senior Living’s acquisition of Emeritus, and we are still not a fan of any company in the space operating 500 or more communities, let alone 1,000. It is just not that easy, and while we do not fault management for having a hard time of it, we do fault management for getting to the size it is. At least, the management responsible for the growth, and not the people trying to work things out. Brookdale announced its first quarter earnings, and investors seemed to like what they saw and heard. They ignoredthe same-community decline on occupancy of 100 basis points to 85.7% year over year, as well as the 80 basis point sequential decline. The... Read More »
The Members Breakfast with Alan Butler
On May 4th, 2017, we hosted the seventh installment of The SeniorCare Investor Members Breakfast at The Princeton Club in New York City. Our special guest at the subscriber-only event was Erickson Living CEO, Alan Butler. For 45 minutes, Mr. Butler sat down with our Editor, Steve Monroe, to discuss his joining Erickson in 2010, the company’s emergence from bankruptcy, and the future of the CCRC model. Subscribers can watch the discussion below.... Read More »Schedule a demo
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