Another Missouri Purchase For Griffin-American Healthcare REIT IV
Griffin-American Healthcare REIT IV returned to Missouri yet again to acquire an assisted living community in the St. Louis suburb of Warrenton. The single-asset transaction follows two portfolio deals for the REIT in the Show Me State, which included eight skilled nursing facilities bought for $88.2 million and two skilled nursing facilities that were a part of a 24-property (the rest located in Illinois) acquisition for a combined $78.5 million. G-A IV acquired the Warrenton property in a RIDEA structure with the incoming operator, Meridian Senior Living, and will own 98% of the JV. Built in 2000, the 53-unit community was 91% occupied, with a 100% private pay census, and in the past... Read More »
Chicago Pacific Founders Refinances Two Southwest Senior Living Communities
On the way to stabilizing its two senior living communities in Tucson, Arizona and Pahrump, Nevada, Chicago Pacific Founders refinanced with the help of Aron Will of CBRE. In 2016, its subsidiary CPF Living Communities acquired the two majority-independent living communities (with assisted living and memory care units as well) from two non-traditional seniors housing owners. Occupancy was low at the time, but Grace Management took over and improved operations, expecting them to fully stabilize by 2019. There are 140 independent living, 60 assisted living and 12 memory care units. CBRE secured a three-year floating-rate loan, with 36 months of interest only, from a debt fund to refinance... Read More »
Rolling Four Quarters Multiples
It has certainly been a busy year in the M&A market, with transaction volume on pace to top last year’s, according to The Senior Care Acquisition Report. Despite all the headwinds and headline issues, buyers are still very active, and in many cases paying top dollar for the assets they want. The independent living market remains the strongest, with the average price per unit rising to $241,300 for the 12 months ended June 30, 2018, or 5% higher than in calendar year 2017. The average cap rate was 7.2%. The assisted living market, where all the excess development has been, dropped by 5% to $209,100 per unit for the 12 months ended June 30, compared with last year. The average cap rate... Read More »
Watermark Retirement Corporation Partners with Singapore Conglomerate
Singapore conglomerate Keppel Corporation is staking a claim in the U.S. seniors housing market with its acquisition of a 50% stake in Watermark Retirement Corporation. That 50% interest plus 50% of the minority interests held by Watermark’s owners in certain communities managed by the company is valued at approximately $77.3 million. This is a big step for Keppel, which had previously not been active in the space. Watermark currently manages 52 seniors housing communities and about 9,400 total beds in 21 states, with a development pipeline of an additional eight properties scheduled to open by 2020. Watermark already had begun reaching across the Pacific with Watermark Senior Living China... Read More »
Two Michigan Transactions from IPA Seniors Housing Trio
Mark Myers, Joshua Jandris and Charlie Hilding of IPA Seniors Housing handled two Michigan transactions at the start of August. First was the sale of a four-property skilled nursing portfolio in Michigan, totaling 393 beds. The aging properties are in need of capital improvements, which was reflected in the (undisclosed) pricing. A large Michigan operator (who sourced REIT financing for the deal) purchased three of the facilities, while a local owner/operator in the Detroit area purchased the facility in Wayne. Second was the sale of a 143-bed skilled nursing facility in the town of Zeeland (Grand Rapids MSA), which involved an Illinois not-for-profit, Providence Life Services, as the... Read More »
Synergies Yield Successful Bond Financing in Georgia
The new relationship between Lancaster Pollard and its parent company (for less than a year) ORIX Corporation USA is paying off for their clients. One of them, Georgia-based Brickmont Assisted Living, took advantage of those synergies to obtain construction financing for its to-be-built assisted living/memory care community in Johns Creek, Georgia. Lancaster Pollard placed $16.7 million of tax-exempt bonds with ORIX USA, offering a drawn-down bond structure that will yield significant savings for Brickmont. After purchasing all the bonds at a fixed interest rate, ORIX USA also gave Brickmont flexible prepayment options, should the company decide to refinance early. Sounds like a good deal... Read More »
Capital Senior Living Disappoints, And Pays A Price
We have now become nervous with each earnings period because there just seem to be too many surprises. Unfortunately, these surprises have usually been negative. Three months after being positive about the direction of the company, Capital Senior Living spooked investors not only with their poor results in the second quarter, but their dismal prospects for the rest of the year. When you underperform expectations, and cut full-year forecasts by 20%, you should expect the worst. And the worst was a 23% plunge in the share price on August 1, followed by a 5% decline the following morning. Volume was 6x the average, but not heavy in absolute terms. The news also took Brookdale Senior Living... Read More »
Transaction Trifecta from Senior Living Investment Brokerage
When it rains, it pours for Senior Living Investment Brokerage, with the firm closing three transactions at the start of August. In the first one, while one assisted living operator exited the seniors housing industry, another entered in SLIB’s latest California sale. Jason Punzel, Brad Goodsell and Vince Viverito successfully sold a 30-unit assisted living community in the town of Chico (Sacramento MSA) for $4.15 million, or $138,300 per unit, with a 10.7% cap rate. Fully occupied, with a 29% operating margin, this 22-year old community was owned by a local operator that wished to exit the industry. Its new owner is a new entrant to seniors housing that is looking to expand throughout the... Read More »
Carnegie Capital Closes Two Financings
Carnegie Capital showed its strength this month, announcing two loan closings in Georgia and Ohio. First, J.D. Stettin sourced and structured $10 million in bridge loans to fund the acquisition of two skilled nursing facilities and 177 beds in Macon and Warner Robins, Georgia (Atlanta MSA). The financing, which came with an interest-only term and no prepayment penalties, featured a loan-to-cost of 80%, so we have estimated the purchase price to be around $70,600 per bed. Then, Mr. Stettin refinanced a brand-new assisted living/memory care community in Cleveland, Ohio with a $16 million loan. A local community bank provided the original $9.5 million construction loan for the community,... Read More »
Thorofare Capital Rises Again In Phoenix Area
Thorofare Capital is expanding its seniors housing bridge lending program and recently closed a $13 million loan on behalf of a 277-unit assisted/independent living community in North Phoenix, Arizona. The floating-rate loan, with a two-year term of interest only payments, provides an initial advance of $10 million to repay the construction loan and also funds reserves while the community leases up. There was also $3 million withheld for the future renovations and performance-based earn-outs. The borrower, a Southern California-based real estate investor, acquired the property out of a bank’s REO portfolio in 2015 when it was an Embassy Suites Hotel. They then converted the building in... Read More »Schedule a demo
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