How Did Buyers Value Cash Flow in Seniors Housing M&A in 2018?
For the seventh year in a row, there was a perfect correlation between the age of seniors housing communities sold and their average net operating income per unit, according to the Seniors Housing Acquisition & Investment Report. This makes sense, given that the newer communities should better reflect the current demand (by unit size, amenities, etc.) and require less capex to maintain their competitiveness. Newer communities also have an easier time attracting good staff and charging higher rents. Those newest communities (built after 2013) had an average of $19,700 per unit of NOI, relatively consistent with recent levels. The next subset of properties built between five and 10 years... Read More »
Lancaster Pollard Keeps the HUD Closings Coming
Lancaster Pollard Mortgage Company just closed its 16th HUD financing since the government shutdown ended in January. They clearly did their leg work during the shutdown, as in the first three weeks following it, 16 of the 25 FHA 232 commitments issued by HUD went to Lancaster Pollard, for a total of $224 million in closings. The latest transaction featured a $17.3 million loan closed on behalf of Tryko Partners for its 171-bed skilled nursing facility in Brick, New Jersey. Over four years ago, Tryko had acquired the facility from Florida-based New Vision for $10 million, or under $60,000 per bed. At the time, it featured 148 skilled nursing beds and 23 assisted living units and operated... Read More »
The Transitional Care Take-Over?
We’ve written about the bifurcation in the skilled nursing market between the traditional SNFs, which tend to be older, feature smaller, semi-private rooms and heavily rely on Medicaid revenues, and the new transitional care facilities, which cater almost exclusively to the Medicare and private pay patients. These feature large private rooms and come with many of the bells and whistles of modern senior living communities. Not surprisingly, these newer properties are developed and sold at much higher values than the traditional SNFs. Indeed, according to our recently-published Skilled Nursing Acquisition & Investment Report, facilities built in the last 20 years (which would include... Read More »
Blueprint Leases St. Louis-Area Skilled Nursing Portfolio
A portfolio of three skilled nursing facilities and 444 total beds in the St. Louis, Missouri area found a new operator/tenant thanks to Ben Firestone, Michael Segal and Billy Lichtenstein of Blueprint Healthcare Real Estate Advisors. Featuring positive cash flow (benefitted by Missouri’s Medicaid rate increase) and desirable locations near Barnes-Jewish Hospital, these facilities are owned by an Illinois-based owner/operator that decided to shift its focus to other owned and recently acquired facilities in Arizona and Illinois. A growing operator with an existing presence in the state was chosen as the new operator for its commitment to capital improvements. The transaction was structured... Read More »
Welltower Acquires Two South Bay Partners Properties
Welltower announced that it has added two more San Antonio senior living properties to its portfolio. Originally developed by the seller, South Bay Partners, these communities opened in 2016 adjacent to each other in the Dominion area of northwest San Antonio. They combine for 335 units of independent living, assisted living and memory care. Welltower is no stranger to the market, already owning two senior living communities operated by Sagora Senior Living, an LTAC operated by LifeCare Management Services and a portfolio of five medical office buildings. No purchase price was disclosed for the latest acquisition, but the properties were last assessed together for $48.6 million, according... Read More »
CEOs and Other C-Suiters: It’s Time to Roll Up Your Sleeves
Steve Monroe has a message for the CEOs and other C-Suiters in the senior care industry. Read More »
Blueprint in the Buckeye State
Connor Doherty of Blueprint Healthcare Real Estate Advisors took his talents to Ohio to close two skilled nursing transactions in the state. First, partnering with Blueprint’s Ryan Kelly, Mr. Doherty represented a California-based private equity group to sell its 99-bed SNF in Newark, near Columbus. Built in 1972 but with consistent updates through the years, plus a new rehab wing added in 2015, the facility was triple-net leased to a local operator. However, when the lease term was up, the operator decided to exit, prompting the owner’s divestment too after about a decade of ownership. The facility was cash-flowing but was 75% occupied with a more-than 30% quality mix. That offers some... Read More »
Kayne Anderson Closes on Three California Communities
Kayne Anderson Real Estate Advisors has joint ventured with Watermark Retirement Communities to add three more California senior living communities to its portfolio thanks to financing provided by SunTrust Bank. Two of the communities were located in the Los Angeles market (in Whittier and Riverside). Averaging about 20 years in age, they had previously been owned by Bridge Investment Group, and Watermark will take over operations. Meanwhile, the third property was up north in the Oakland MSA town of Emeryville. It was previously owned by Welltower and managed by Watermark, which will stay on as operator. To fund the acquisition, SunTrust Bank provided $69.5 million in financing. Following... Read More »
Walker & Dunlop Finances Arcapita-Owned Assisted Living Communities
Just over three years since buying three assisted living communities in Colorado, Middle East-based alternative investment fund manager Arcapita is refinancing them with the help of the team of Stuart Wernick, Jeff Ringwald and Bill Jackson of Walker & Dunlop. Operated by MorningStar Senior Living since opening in 2013 and 2014, the communities were nearly stabilized when they were acquired in December 2015 for a combined $79.5 million, or just over $400,000 per unit. Two of the communities feature a combination of assisted living and memory care units in Colorado Springs and Centennial, and the third property (also in Colorado Springs) serves exclusively memory care residents. In all,... Read More »
Recent Senior Care M&A Deals, Week Ending April 19, 2019
Check out our recent senior care M&A deals! Long-Term Care AcquirerTargetPrice Target Healthcare REIT LimitedCare home$9 million Afton PropertiesAurora Village Apartments$8.65 million Preservation of Affordable Housing6 senior apartment communitiesN/A Triloma Seniors HousingThe Fountains of Granite City & The Fountains of... Read More »Schedule a demo
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