New Staffing Regs Announced
Although three months late, the Biden administration and CMS finally came out with their proposal for minimum staffing requirements for nursing homes. They should have waited longer, but what would be the point? They were tone deaf to the staffing problems anyway. The proposed change includes a minimum of 0.55 hours of care from an RN every day, a minimum of 2.45 hours from a certified nurse’s aide per day, but these are the floors. In addition, an RN will have to be on site 24 hours a day. That is going to be very tough for many facilities. Rural nursing homes will have up to five years to meet the proposed standards, and non-rural facilities up to three years. There will be a 60-day... Read More »
Diversified Healthcare Trust Merger Canceled
First it was a postponement of the shareholder vote for a week, and now the ill-fated merger between Diversified Healthcare Trust (DHC) and Office Properties Income Trust (OPI) has been terminated. Two vocal shareholders combined with the three proxy firms advising against the merger was enough to convince management to finally give up. For now. Both parties to the merger have been struggling, and while management stated that this was the only way that DHC would be able to refinance its debt and get on a more solid financial footing to grow, the terms of the transaction seemed to penalize DHC shareholders too much at a time when its major operator was on the road to recovery, albeit more... Read More »
SLIB Sells an Assisted Living/Memory Care Community
An assisted living/memory care community on the operational rise sold to a private equity firm with the help of Jeff Binder, Jason Punzel and Dave Balow of Senior Living Investment Brokerage. Built in 2017, the 134-unit community is located near Rochester, New York. A national real estate investment firm owned it and was overseeing an operational rebound from the pandemic, which continued throughout the sale process. A western New York-based PE firm with an existing presence in the Rochester area emerged as the buyer, for an undisclosed price. Read More »
Newmark Finances Two Seniors Housing Communities
Newmark closed a couple of financings at the end of August. One funded an acquisition that the Newmark team had handled in March 2023. The Preston of the Park Cities, which was previously owned by Silverstone Senior Living, sold to an undisclosed buyer, for an undisclosed price. Built in 2018, this community has 134 units of assisted living and memory care. Silverstone developed it, initially bringing in Harbor Retirement Associates to operate before switching to Watermark Retirement Communities in 2019. Occupancy never reached full stabilization before the pandemic and stood at just 75% at the time of closing. The Newmark team had some history at this property, as Ryan Maconachy, Chad... Read More »
Ziegler Closes $118.33 Million Financing
Investment banking firm Ziegler just closed a $118.33 million bond financing for Emerald Heights, a not-for-profit CCRC in Redmond, Washington, with 333 independent living units (including apartments and cottages), 40 assisted living beds, 16 memory care units and 61 skilled nursing beds set on 38 acres. Emerald Heights was established in 1979. The proceeds will be used to finance the construction and equipping of 54 new assisted living units and a sky bridge connecting these units to the main IL building, as well as to fund the construction of 42 new IL units. The remainder of the proceeds will go toward paying off existing debt and certain costs of the bond issuance. The tax-exempt... Read More »
Vote On Diversified Healthcare Trust Merger Postponed
While we are not surprised, the vote on the merger of Diversified Healthcare Trust and Office Properties Income Trust, scheduled for this past August 30, has been postponed until September 6, even though “the polls remain open.” With the three major proxy firms weighing in against the merger, as well as a holder of 9.8% of DHC stock, we assume the managements of the two merging firms realized they did not have the votes. We stated last week that we thought something fishy was going on, and we didn’t like the smell. There are just too many conflicts of interest, but we do not know what could happen between August 30 and this coming September 6, two days after the Labor Day holiday, to... Read More »
Three Acquisition Loans from CIBC
Lending in the senior care space may have slowed in 2023, but CIBC Bank USA announced a slew of new loans it provided to skilled nursing facilities across the country in the last couple of months. The largest went to an Indiana-based owner/operator to acquire four skilled nursing facilities in the southern part of the state. Totaling 450 beds, the facilities were managed by a local operator and had an effective age between 10 and 15 years. Historical EBITDAR margins were close to 15% and were around that level at the time of the deal. The buyer received a $32 million loan plus a $4 million revolving credit facility for the acquisition. Next, a Nebraska owner/operator bought a 120-bed... Read More »
CFG Refinances Previous Bridge Loan with HUD Debt
Capital Funding Group closed a $7.2 million HUD loan to take out an existing bridge loan on a 75-bed skilled nursing facility in Ohio. CFG had also executed the bridge debt. The deal was closed on August 17, 2023, on behalf of a nationally recognized borrower. Capital Funding Group Managing Director, Real Estate Finance Tim Eberhardt originated the transaction. The financing follows the company’s recent announcement of its total financing for the first half of 2023, which exceeded $411 million across 27 deals nationwide. Read More »
SNF Transfers Hands from a Not-For-Profit to a For-Profit
Ziegler handled the sale of Bethesda Rehab & Senior Care, a 135-bed skilled nursing facility located on two acres in Chicago, Illinois. The facility has had a presence in the Chicago area for over 100 years and was originally part of the CCRC Norwood Crossing, founded in 1896. It provides short-term rehabilitation, long-term skilled nursing care, respite care and Alzheimer’s care. The seller was a not-for-profit owner/operator, and the buyer was a joint venture between a well-known multi-generation Midwest owner/operator with control of several thousand beds, and Pearl Healthcare, which operates more than 10 facilities in Chicago. Pearl took over operations of Bethesda on July 1. Nick... Read More »
60 Seconds with Swett: SNF Values Begin to Drop
The surge in capital costs has finally eaten into the price per bed for skilled nursing facilities, at least according to our latest averages. Using data from our proprietary M&A database which includes dozens of confidential prices and property financials, the average price per bed for skilled nursing facilities in the four quarters ended June 2023 dropped 6.5% to $106,800 from its record-high of $114,200 per bed from calendar year 2022. Anecdotally, we had heard that buyers were not paying the prices they were in 2022 but that investor interest (and prices as a result) was still higher than it was before and during the pandemic. That checks out with our numbers, since the latest... Read More »Schedule a demo
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