Skilled Nursing Values Stabilizing
You know us. We have always been bullish on the long-term prospects of the skilled nursing sector. You have read on these pages how investment interest never slowed even as average prices dropped in the past few years from the record peak of just over $99,000 per bed in 2016, a level that we thought was not sustainable, at least not in the short term. After two years of declines, there has been a slight turnaround. According to our rolling four quarters statistics, for the 12 months ended June 30, 2019, the average price per bed was $79,950, which is a 3.1% increase over calendar year 2018. This could just be a quirk in the numbers, as in a few higher prices in the second quarter of this... Read More »
Maximus Healthcare Gets Mezzanine Financing
Contemporary Healthcare Capital has been on a roll lately, closing mezzanine loan after mezzanine loan for clients across the country. Its latest transaction saw the firm refinance a 165-bed skilled nursing facility in Newfane, New York owed by Maximus Healthcare Group, LLC. Maximus had announced its intent to acquire the aging facility in November 2014, closing the deal in January 2016 at a purchase price of $7 million, or $40,000 per bed. The facility was built in 1963 and was acquired by Eastern Niagara Hospital in 1997. When Maximus took over, the facility was losing money, with occupancy at 83%, and the hospital was looking to sell off its ancillary assets. Since acquiring it, Maximus... Read More »
Independent Living Values Continue Climb
Finally, after five years, independent living values appear to have returned to 2014 levels. According to the latest four-quarter period ended June 2019, the average price for independent living properties rose to $257,800 per unit, up 2.4% from the $251,800 per unit in the four quarters ended March 2019 and 8.3% from the $238,100 per unit in calendar year 2018. That level is also 4.5% higher than the previous record-high price of $246,800 per unit observed in 2014, according to the Seniors Housing Acquisition & Investment Report. Back then, many owners of high-quality, well-performing IL communities in high-barrier-to-entry markets saw high per-unit prices in the M&A market and... Read More »
Blueprint’s Good Samaritan Sale
The Evangelical Lutheran Good Samaritan Society, a not-for-profit owner/operator, sold three of its skilled nursing campuses in northwest Illinois, near the Iowa border. Totaling 214 skilled nursing beds and 65 independent living/senior apartment units, the portfolio was well maintained and boasted good local reputations. The buyer will look to manage expenses and boost operational synergies to improve their performance. Plus, the new operator, Allure Healthcare Services, has plenty of experience with rural skilled nursing facilities in the area, which should certainly help. Amy Sitzman and Michael Segal of Blueprint Healthcare Real Estate Advisors handled the transaction on behalf of Good... Read More »
Ensign Expands Again in Arizona
Serial acquirer The Ensign Group just announced its 10th senior care acquisition of the year, and 20th since the start of 2018. Its latest target was a 100-bed skilled nursing facility in Surprise, Arizona. Newly built, the facility is the seventh added to Ensign’s Arizona portfolio since 2018 and its 31st overall health care property in the state. As usual for Ensign’s Arizona acquisitions, its affiliate Bandera Healthcare will take over operations at the facility. Ensign also acquired the real estate, furthering its goal to own more of the real estate in its portfolio. Read More »
GFH Capital Gets Financing From Greystone
Last month, Dubai-based private equity firm GFH Capital jumped into the senior living market in a big way, acquiring a group of six properties for a total purchase price over $180 million. Now, Greystone has announced that it provided a total of $115 million in Freddie Mac and Fannie Mae Shariah-compliant financing to support the acquisition. Cary Tremper originated the financing on behalf of GFH (which will own 91% of the portfolio) and Washington, D.C.-based real estate investment firm Madison Marquette, which is acquiring another 6%. JEA Senior Living, Senior Resource Group, two of the three operating partners GFH has selected to manage the communities, have also each co-invested in... Read More »
White Oak Refinances GMF Capital SNF Portfolio
GMF Capital refinanced 14 of its skilled nursing facilities with an $81 million credit facility secured by White Oak Healthcare Finance. The financing is comprised of a $66 million senior credit facility to refinance the properties, which are located in Ohio and Kentucky, and a $15 million line of credit closed for the operating company. This isn’t GMF’s first experience with White Oak, as the lender arranged another senior credit facility for the investment management platform to acquire a couple of assisted living/skilled nursing properties in Rhode Island at the end of 2018. Meridian Senior Living was the operating partner in that deal. Read More »
The Skilled Nursing Rebound
Average prices per bed ticked up over the past four quarters, and Genesis Healthcare posted better results. In this month’s SeniorCare Investor, I talked about the recent rise in the average price per bed for skilled nursing facilities for the most recent trailing four quarters. A small rise, but up nonetheless. Perhaps the start of a SNF rebound. And then Genesis Healthcare reported its second quarter results, and while they still have a ways to go, they too have seen some improvement. Small, but we will take it. Compared with the year-ago quarter, occupancy was up 250 basis points to 86.6% and the EBITDAR margin was up 79 basis points to 13.6%. Now, some of this improvement most likely... Read More »
Pardoll Closes Slew of Southeast Sales
Mike Pardoll of Marcus & Millichap has spent the last few months crisscrossing the Southeast, closing a number of seniors housing and skilled nursing transactions along the way. Starting in Dickson, Tennessee (Nashville MSA), he represented a private individual in selling their 70-bed skilled nursing facility to another private individual buyer. Leased by Mission Health (an affiliate of the private equity firm Windward Health Partners) as part of a 10-facility lease that includes other SNFs in Tennessee and Georgia, the facility was originally built in 1974. It was well occupied at 90% and produced around $930,000 in annualized 2018 EBITDA. The current lease is $31,000 per month, which... Read More »
Blueprint Sells Boutique Assisted Living Portfolio
Brooks Blackmon of Blueprint Healthcare Real Estate Advisors used his Southeast expertise to sell a portfolio of four boutique assisted living communities in Alabama. The small communities, which were all built in the late-1990s, were deemed to be non-core by the skilled nursing-focused owner/operator. In addition, they were operating around breakeven and offered a value-add opportunity to a new owner. After confidentially approaching three groups that showed interest, Mr. Blackmon secured the buyer, an Alabama-based owner looking to grow its presence in the state. Read More »Schedule a demo
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