Capital Senior Living Finally Reports

by Steve Monroe | Apr 1, 2020 1:06 pm | 60 Seconds, Opinion

After a two-week delay, Capital Senior Living reports fourth quarter results, and a little of first quarter. After delaying its fourth quarter earnings release by two weeks, Capital Senior Living finally produced the results. And they were not as bad as we expected. Phew. To be honest, I was thinking it could be so bad that bankruptcy would be floated as an option. Not this quarter. The bottom line is that the fourth quarter was not good, with same-community year-over-year occupancy declining by 290 basis points to 81.4%, and the operating margin falling by 600 basis points to 29%. Both are very large drops in a 12-month time frame. And both are worse than their peer group. The good news... Read More »

MonticelloAM Funds Large Virginia Acquisition

by | Mar 31, 2020 4:03 pm | Acquisitions, Financings

MonticelloAM and its affiliates just announced a large first lien debt financing to fund the acquisition of five skilled nursing facilities in Virginia. The borrower, an experienced owner/operator with an established relationship with Monticello (having received acquisition financing for several other facilities in 2019), obtained $97.2 million in debt, including an $8 million working capital loan provided to its operating companies. Monticello’s asset-based lending group, Monticello Commercial Capital, provided the working capital.   The acquisition featured 856 beds located primarily around Richmond, bringing the owner’s portfolio to a total of 1,155 licensed beds. The... Read More »

Blueprint Closes Dallas-Area Deal

by | Mar 31, 2020 4:00 pm | Acquisitions

The COVID-19 pandemic was really ramping up in mid-March when Amy Sitzman and Giancarlo Riso of Blueprint Healthcare Real Estate Advisors managed to close the sale of a memory care community in the Dallas-Fort Worth area of Texas. Featuring 60 units of assisted living and memory care, the community is located in an affluent area, with the median housing values more than 44% higher than the Dallas MSA average. Built in 1997 with over 44,200 square feet, the community targeted the middle market, but its occupancy was trending towards 75% at the time of the sale. It was also operating at breakeven.   Working on behalf of the institutional owner/operator seller, Blueprint marketed the... Read More »

Newmark Sells Skilled Nursing Portfolio

by | Mar 31, 2020 3:57 pm | Acquisitions

Newmark Knight Frank sold a portfolio of six skilled nursing facilities in Arkansas earlier this month on behalf of CNL Healthcare Properties. There was a total of 868 beds, and according to CNL’s SEC filing, the reported price was $55 million, or $63,400 per bed. The facilities were built in the 1980s and 1990s and average occupancy was near 83% to 84%. An affiliate of Capital Health Group was the operator. An East Coast-based owner with operations already in Arkansas was the purchaser. Dave Fasano and Ross Sanders of Newmark Knight Frank handled the transaction.  Read More »

Two Southeast Sales from Blueprint Healthcare Real Estate Advisors

by | Mar 30, 2020 4:37 am | Acquisitions

The team at Blueprint Healthcare Real Estate Advisors announced a couple of deals that closed earlier this year. The M&A market was a little different back then, close to a peak in terms of pricing and definitely at a peak for activity. Seems like just yesterday.   First, Ben Firestone, Michael Segal and Trent Gherardini sold a portfolio of three assisted living/memory care communities on Florida’s Gulf Coast. Featuring a majority-private pay census and historically operating near stabilization, the properties were recently impacted by the high level of new development in southwest Florida. Given what we have heard of the level of groundbreakings around Naples, Sarasota and Tampa, that... Read More »

Newmark Closes Deal in Florida

by Steve Monroe | Mar 27, 2020 3:40 pm | Acquisitions

The team at Newmark Knight Frank closed a two-property deal in Florida for a total price of $48.85 million, or $270,000 per unit. The portfolio includes Summer Vista in Pensacola, which was built in 2016 and has 89 assisted living and memory care units with an envious occupancy rate close to 99%.   The second property, The Crossings at River View, is located in Tampa. It opened in mid-2015 with 92 assisted living and memory care units and had occupancy below 85%. It was last sold in 2018 for about $24 million. Superior Residences had been the manager for the two communities. We have heard from other buyers that total revenues for the two communities were just... Read More »

Recent Senior Care M&A Deals, Week Ending March 27, 2020

by | Mar 27, 2020 3:38 pm | Acquisitions

Check out our recent senior care M&A transactions! Long-Term Care AcquirerTargetPrice Non-traded REITMemory care community in Southeast$21.775 million Mid-Atlantic-based owner/operatorBrookdale NorthportN/A Private equity firm3 assisted living/memory care communities in FLN/A Private investorAssisted living/memory care community in Greenville,... Read More »

Sabra Health Care REIT Cuts Dividend

by Steve Monroe | Mar 27, 2020 4:39 am | Opinion

It was bound to happen. When the share prices of healthcare REITs plunged by 50% and more, their yields spiked to rates unheard of, with four of them over 15%. Sabra Health Care REIT was one of them, peaking at 30.4%. This was not only absurd, but not sustainable. As Rahm Emanuel famously said, “why let a crisis go to waste?”  We are in a crisis, no doubt about it. And while all the REITs have recovered some of their lost values, investors are not starry-eyed about the near-term future for healthcare REITs and their tenants. No matter how much of a positive spin you try to put on it, such as Tom DeRosa’s well-received remarks a week ago, the reality is a bit different.  So, Sabra’s... Read More »

Avoiding The MAC Clause?

by Steve Monroe | Mar 26, 2020 4:39 pm | Financings, Opinion

Last week, we were surprised to hear that a few companies quickly drew down on their revolving lines of credit. In the case of Ventas, the amount was $2.75 billion and they withdrew 2020 earnings guidance as well. For Brookdale Senior Living, they did a full drawdown of an unspecified amount, and also withdrew their 2020 earnings guidance. Omega Healthcare Investors drew down $300 million. Mostly, these were stated to be for precautionary and future liquidity reasons.   We were a little surprised that a few more companies did not withdraw 2020 guidance, but perhaps they are not at risk as much as Brookdale and Ventas with the seniors housing uncertainty and... Read More »

Newmark Sells Connecticut Community

by Steve Monroe | Mar 26, 2020 4:33 pm | Acquisitions

Newmark Knight Frank closed on a large senior living community in Farmington, Connecticut a few weeks before the COVID-19 pandemic let loose in the Northeast. The community was built in 2015 and has 89 assisted living and 45 memory care units for a total of 134 units. Occupancy was at 97% when it went to market, which is fantastic in any market.   Assisted living rates average about $4,100 per month plus care levels, while memory care rates range from $5,600 for a shared room to $7,700 for a private studio. Based on that, we have estimated revenues to be just above $8.0 million assuming occupancy has remained high. Farmington is one of the nicest towns in the middle of the state with a... Read More »

Dwight Capital Refinances Utah Assisted Living Community

by | Mar 26, 2020 3:55 pm | Financings

Dwight Capital got a HUD financing closed in West Jordan, Utah (Salt Lake City MSA). The target was a Beehive Homes community built in 1996 and 2007 on over 1.5 acres. It currently consists of 50 beds in 50 units and is located less than a mile from Jordan Valley Medical Center. The license allows the community to care for 11 AL Type-1 residents, 16 AL Type-2 residents and 16 residents in a secure memory care unit.   To refinance the property, Kevin Lifshitz of Dwight Capital arranged a $4.28 million loan with a 35-year term and amortization. We’re sure it was no easy feat.  Read More »