Live Oak Bank Closes Two Refinances
A couple of senior living communities refinanced with the help of the team at Live Oak Bank . In the first deal, KSL Seniors, a developer/owner focused on the western United States, secured a five-year loan with a floating interest rate to refinance its newly built 71-unit assisted living/memory care community in Greely, Colorado. Opened in Q4:19, the property is operated by Cadence Senior Living and offers common areas and amenities with an appeal to not only the community’s residents, but their extended families. The loan totaled $8.1 million and took out a construction line of credit. It also allowed KSL to recapture a line of credit capacity to pursue future projects. Then, Live Oak... Read More »
Lancaster Pollard’s Recent Fannie Mae Activity
Lancaster Pollard secured two Fannie Mae financings for senior living clients across the country. The first was an $11 million fixed-rate loan provided to a senior living community in Dover, Pennsylvania (York County). Featuring a mix of independent living, assisted living and memory care services, the one-story community has amenities such as gazebos, walking paths, a café and therapy suite offering occupational, physical and speech therapies. Miles Kingston, Doug Harper and Casey Moore led the transaction. Then, Messrs. Moore and Harper were joined by Grant Goodman to arrange a $7.2 million loan for a memory care community in Edmonds, Washington (Seattle MSA). Operated by Northwest Care... Read More »
PMB Turns Copper Into Gold
What do you do with a former copper mill that once produced 25% of the world’s copper but also produced substantial toxic waste? Well, after 30 years of remediation and being removed as an EPA Superfund site, you build a luxury senior living community, of course. That is exactly what San Diego-based PMB, a healthcare real estate developer and GenCare Lifestyle are planning in Tacoma, Washington. The two companies are developing GenCare Lifestyle at Point Ruston, a 144,000 square foot retirement community with 155 units. It is located in a mixed-use waterfront resort-inspired village on the southern edge of Puget Sound in Point Ruston, a master-planned urban... Read More »
Milwaukee Senior Care Complex Sells
A large (67,000 square feet) and old (built-in 1964) Residential Care Apartment Complex (“RCAC”) in Milwaukee, Wisconsin sold after falling on hard times. Known as St. Clare Terrace, it is made up of 59 units in a large building that sits on 2.4 acres. At the time of sale, occupancy was just 64%. The property was placed into receivership after the former not-for-profit owner/operator defaulted on their outstanding bonds. The receiver appointed BAKA Enterprises to manage the community until it was sold. Annualized revenues were just under $1.1 million, which would put average monthly rates close to $2,400. Before debt payments, there was a negative cash flow of about $175,000. Next... Read More »
Sabra Health Care REIT’s Private Pay Push
Sabra Health Care REIT has another 10 months to pull the trigger on its purchase option to buy the remaining 51% of Enlivant still owned by private equity giant TPG. Sabra closed on its 49% interest at the beginning of 2018, when occupancy at Enlivant was just 82%. This was a sharp improvement from the 60% census when TPG hired financially and operationally distressed Assisted Living Concepts in 2013. TPG brought in Jack Callison to run it and turn it around. Going from 60% to 82% in less than five years was no small feat, especially after the bridges that the former ALC management burned with several state regulators. When Sabra bought its 49%... Read More »
60 Seconds With Steve: Best Time to Borrow is Now
In 60 Seconds With Steve, he discusses that even with tumbling stocks, the best time to borrow would be right now. I guess the markets are finally taking the coronavirus seriously. The worst may yet to come, at least for the virus. Monday’s more than 1,000-point plunge in the Dow shocked a lot of people, but we need some perspective. That drop is just over 3%, not that much of a plunge when you put it into a historical perspective. On October 19, 1987, after just one year in the senior living business, I checked into a hotel in Pennsylvania for a state conference. I turned the TV on and saw the merely 508-point drop in the Dow on the screen. But that was a 22.6% plunge. Think of that:... Read More »
CareTrust REIT’s Bountiful Acquisition
CareTrust REIT just bought an assisted living community in Bountiful, Utah, leasing it to Bayshire LLC, which will take over operations going forward. Built in 1999, the 62-unit community is well situated on the campus of Lake View Hospital, an affiliate of MountainStar Healthcare and HCA Healthcare. It was previously owned by the not-for-profit South Davis Community Hospital Campus, but was sold so South Davis could focus on its adjacent higher-acuity operations. Bayshire took over the operations, adding the facility to its master lease with CareTrust that has a remaining term just under 15... Read More »
Ventas Seeking Investment Partners
In what we would call a change in strategy for a healthcare REIT, Ventas is launching a new “growth platform,” called the Ventas Life Science and Healthcare Real Estate Fund, L.P. They are calling it a “perpetual life vehicle” that will focus its investments in core and core-plus life science, medical office and seniors housing real estate. It will officially launch late this quarter, and it will have $700 million in assets under management, and they have third-party equity commitments for about $650 million, so far. Ventas will be the fund sponsor and general partner, expecting to hold a 20% ownership stake and participating in the future cash flows. Ventas EVP... Read More »
Maryland Senior Care Portfolio Refinances With Harborview
Harborview Capital Partners announced it has arranged to finance a portfolio of four skilled nursing facilities and one assisted living community in Maryland. A New Jersey-based owner recently purchased the properties and was seeking a cash-out refinance. Working with Ephraim Kutner, Jonathan Kutner and Eli Kutner of Harborview, they obtained an $81 million loan from a national lending partner. The financing came with an aggressive LIBOR-based fixed interest rate and a four-year term. With the transaction, the borrower was able to cash-out in excess of $20 million, with limited recourse. Read More »
REIT Sale/Leasebacks Are Not Dead
It is very easy to say that sale/leaseback structures with REITs are dead, especially if your leases are dead in the water. But then you have to ask, why are they dead in the water, and why did you enter into long-term leases in the first place? You could have always financed your properties with debt at 70% to 80% loan-to-value, but the odds are you wanted to recapture some of your equity for growth (or your retirement), and there is always a price you pay for essentially leveraging your property 100%. The real benefit of a sale/leaseback, in addition to the cash you take out, is that everything above the lease payment is yours. The REIT gets its fixed lease return,... Read More »Schedule a demo
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