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 »Rocky Mountain Assisted Living Portfolio Sells
Senior Living Investment Brokerage successfully closed the sale of an assisted living portfolio with the help of Vince Viverito, Jason Punzel, and Brad Goodsell. The portfolio comprised a total of 212 assisted living and memory care units across three properties in the Rocky Mountain area. Built from 2017 to 2020 the portfolio sold for a price of $37.5 million or $177,000 per unit. Occupancy ranged drastically from a community in lease-up at 12% to a community with 77%. An Arizona-based owner/operator purchased the assets from a Utah-based developer who was looking to exit the industry. Read More »Waterbury-Area SNF Sells in Connecticut
The Prestige Group announced the sale of a skilled nursing facility in Watertown, Connecticut. The 46-bed facility was known as Watertown Convalarium and was renamed Trinity Terraces. The property sits on 8.5 acres in the greater Waterbury area. Joe Shallow and Richard Natow handled this transaction. The seller of the facility was not disclosed. An LLC linked to Venkat Doddapaneni was the buyer. Read More »Naples CCRC Embarks on Expansion
Suffolk Construction has plans in place to tear down a trio of vacant independent living apartment buildings at Vi at Bentley Village, in Naples, Florida, as part of a redevelopment project on the Naples campus. Demolition is expected to start August 22, and the renovations are to be completed by the end of February 2024. The redevelopment project will bring the community four new buildings comprising 64 independent living units, in five potential floor plans. Each unit ranges in size from 2,400 to 4,500 square feet. The independent living community offers resort-like amenities, as well as lake and golf course views. Each new residence will offer a spacious, screened-in outdoor living... Read More »Two High-Quality Michigan Communities Sell
Two newly built assisted living/memory care communities in the Detroit, Michigan area found new owners thanks to the team at Evans Senior Investments. Built between 2019 and 2020, the communities were smaller in size, with less than 65 units at each location. That meant that ownership (a growing regional operator) could quickly fill the communities, even during the pandemic, with occupancy standing at 88% at the time of marketing. The communities also boasted a 34% operating margin at that time, and in January 2022 the seller implemented inflation-based rental rate increases for existing residents that averaged an increase of 12%. An added $400,000 of revenue as a result surely made the... Read More »KIRCO/Phoenix Open Alabama Community
Michigan-based KIRCO, a commercial real estate development and investment firm with operations in 17 states, and Phoenix Senior Living, a Georgia-based operator with over 50 communities across the Southeast, announced the opening of Madison Crossings in Madison, Alabama, 10 miles outside of downtown Huntsville. Operated by Phoenix, the community offers 105 independent living and 27 memory care units, beginning to welcome residents this April. Amenities include an outdoor pool, wellness center, pub, beauty salon and spa, yoga studio, pickleball and bocce ball courts. The project represented the 10th Alabama property under the Phoenix Senior Living brand. Read More »Atlas Healthcare Acquires Connecticut Portfolio
Atlas Healthcare, a skilled nursing provider based in central New Jersey, acquired a portfolio of 3 senior care properties in the greater Hartford, Connecticut area. Evans Senior Investments represented them in the transaction. Featuring one independent living community and two skilled nursing facilities in Manchester and Vernon, the portfolio totals 114 independent living units and 246 skilled nursing beds. Prior to the pandemic, the properties were 92%+ occupied and featured a strong post-acute rehab census mix within the skilled nursing portion. But operations took a hit, and the portfolio overall was losing money. Paul Liistro, CEO and administrator of the three properties, sold the... Read More »CCRCs Continue to Outperform
Investment banking firm Ziegler just came out with its quarterly analysis of the CCRC (LPC) market, using the NIC MAP census data. For the 99 NIC primary and secondary markets, CCRC average census increased by 50 basis points to 86.0% from the first to the second quarter. This is about 690 basis points higher than non-CCRCs. The analysis covers 1,097 not-for-profit and for-profit CCRCs, both entrance-fee and rental in the 99 markets. We do not know about the other 900+ CCRCs in the country. Occupancy growth since the bottom of the pandemic has been slower in CCRCs than the rest of seniors housing mostly because census did not fall as much during the pandemic, with a relatively healthier... Read More »Tailwind Investment Group Buys Active Adult Community
California-based investment group, Tailwind Investment Group has acquired the active adult community Vista Grande in Rio Rancho, New Mexico. Built in 1972, the community comprises 168 units and sits on 11 acres just outside of Albuquerque. Cooper Street Capital (the seller) utilized Northmarq Investment Sales to help them sell the fully leased community. Tailwind purchased the asset with the intention of making renovations to the property as well as planning for future acquisitions in New Mexico. The location of Rio Rancho appealed to Tailwind because about 100,000 people in the area hold a median household income about 20 percent higher than the rest of the Albuquerque metro area.... Read More »Montgomery Intermediary Group Closes Tennessee Transaction
Andrew Montgomery, Co-Founder and Vice President of Montgomery Intermediary Group, closed the sale of an assisted living community in Tennessee. The community’s owner and operator was looking to retire from the seniors housing business and sold it to another owner/operator in the Nashville area that was looking to expand on its existing portfolio. When stabilized, the community could be operating above 20% margins, which would amount to more than a 10% cap rate on the deal. That is the opportunity for the buyer, as well as the risk. The purchase price was not disclosed, but we understand it to be around $40,000 per unit. Read More »Schedule a demo
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