Getting Very Mad
Academics say that PE firms are responsible for the deaths of up to 20,000 Medicare patients over 12 years. Reckless. I don’t know about you, but I am really getting mad at what I am reading. Four academics just came out with a research paper on the impact of private equity on the skilled nursing industry. Backed up by equations that few of us would understand, they concluded that private equity firms are responsible for up to 20,000 deaths of Medicare patients in nursing homes over a 12-year period. Really? The study included 128 deals for 1,674 facilities and 136 unique PE firms that acquired nursing facilities. Hmm. 136 “unique” PE firms. Even over 12 years that seems like a stretch. I... Read More »
Scribner Capital/Fundamental Advisors Close Mezz Deal
Scribner Capital just announced another financing closed with partner Fundamental Advisors, just a couple of weeks after the partnership funded a deal in Jacksonville Beach, Florida. This transaction involved a construction loan provided to support the development of a senior living community in Prescott Valley, Arizona. Set to open next summer, the community will include 25 independent living, 75 assisted living and 30 memory care units, plus six IL cottages. Residents will also be able to take advantage of amenities like the on-site theater and a club room with mountain views. Link Senior Development, which focuses on secondary and tertiary markets in the western United States, is... Read More »
M&T Realty Closes Chicagoland Refinance
M&T Realty Capital Corporation provided a $15.145 million Fannie Mae loan to refinance an 80-unit active adult community in St. Charles, Illinois (Chicago MSA). Steven Muth and Matthew Pipitone led the financing for M&T, while Eric Johnson of Ziegler arranged the deal. The loan came with a 10-year term and a fixed interest rate below 4.00%. It was structured with five years of interest-only payments, followed by a 30-year amortization schedule. Also, the loan carried a declining prepayment schedule, which provides the borrower, who remains undisclosed, additional flexibility in future years. The community being refinanced was extremely well occupied... Read More »
NorthMarq Refinances Merrill Gardens Community
A Merrill Gardens-operated senior living community in Rancho Cucamonga, California just refinanced its debt with a $31 million loan arranged by Stuart Oswald and Gordon Mickelson of NorthMarq. Owned by a joint venture between Merrill Gardens and AEW Capital Management, the three-year old community features 112 units of independent living, assisted living and memory care. A life insurance company provided the debt, which came with a five-year term and 30-year amortization. NorthMarq structured the loan prior to stabilization, but the community was approaching that level upon closing. Read More »
ProMedica And MetroHealth Collaborating On New Kind of SNF
We have always expressed confidence in skilled nursing’s role in the post-acute continuum of care model going forward, but it’s true that the sector will also have to adapt to guarantee its place there. Two Ohio-based health systems signed a collaborative agreement to operate a new kind of skilled nursing facility, one that we may see more of in the future. Toledo-based ProMedica and Cleveland-based The MetroHealth System will operate the facility (which will open later this year) on the site of the former Deaconess Hospital and will be jointly staffed by the health systems. ProMedica will provide most of the caregivers and will hire and manage the... Read More »
Welltower Obtains Cheap Capital
There has been a lot of noise over the past year about the debt markets being “closed,” or partially so, spreads widening, terms tightening and lenders not wanting to venture into loans with new borrowers. And, we have to mention, Treasury rates have risen significantly, with the 10-year rate actually tripling from its low in 2020. With that as background, we were glad to see that Welltower was able to sell $750 million in unsecured 10-year notes at an interest rate of 2.8%. That represents a spread of just 120 basis points over the 10-year Treasury rate. If not a record, that is close to a record low spread for a healthcare REIT raising funds on an unsecured basis. And it... Read More »
Hollywood, Florida Acquisition Sees Multiple Sources of Financing
IDB Bank and Contemporary Healthcare Capital collaborated on a financing package to support the acquisition of an assisted living community in Hollywood, Florida. Built in the early 1960s and renovated in 2016, this community boasted an average occupancy of 96.5% in the last 12 months, an impressive feat to say the least. It features 105 beds in 57 units and is being purchased by an assisted living owner/operator looking to grow its presence in Broward County. They already own one community in Hollywood and provide third-party operations for another local community for 428 Healthcare Management. To fund the deal and some immediate repairs, IDB first placed a... Read More »
Meridian Makes It Happen Down South
Meridan Capital Group’s seniors housing and healthcare team secured a recapitalization refinance for an eight-property seniors housing portfolio in the Southeast. Located in South Carolina, Tennessee and Kentucky, the communities comprise 296 independent living units, 172 assisted living units and 79 memory care units for a total of 547 units. The names of the properties and total amount of the financing were not disclosed. Dominion Senior Living developed and operated them but will stay on as operator for the new owner, Harrison Street. Meridian’s Ari Adlerstein, Ari Dobkin, Josh Simpson, Matt Lesnik and David Gottlieb negotiated the... Read More »
Recent Senior Care M&A Deals, Week Ending March 26, 2021
Dealmaking is still on the slow side for senior care, but here is our most recent M&A deal chart. Long-Term Care AcquirerTargetPrice Pacifica CompaniesKenmore Senior Living$4.5 million The Pointe GroupHarborChase of Naples & HarborChase of Venice$26.8 million CareCore Mary Scott Nursing CenterN/A Cedar CommunitiesMulberry Grove Senior... Read More »
Bifurcation Between Stabilized and Non-Stabilized SNFs Grew in 2020
In some ways, the pandemic only rubbed salt in the wound in terms of occupancy across skilled nursing facilities nationwide. Average census across the skilled nursing industry was already languishing between the mid- to low- 80% range before the pandemic temporarily shut the doors to many facilities, paused elective surgeries and sent more post-acute patients home to recover. These problems adversely affected the older, mostly-Medicaid facilities and were only made worse in 2020. That means digging out from the pandemic will be a tougher assignment, and buyers paid accordingly in 2020, averaging $55,300 per bed for non-stabilized facilities reporting occupancy lower... Read More »Schedule a demo
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