What About the CCRC M&A Market?
The CCRC (or LPC) acquisition market, which we highlighted in the First Edition of The Seniors Housing Acquisition & Investment Report, is the thinnest of all the major sectors of seniors housing and care. The number of potential buyers is smaller, the lender and investor pool is smaller, and the number communities for sale each year is smaller. Because the market is not very active, we have grouped our statistics in two-year intervals (with the exception of the three-year period before the Great Recession) to minimize the impact of outlier sales at both extremes. Anecdotally, we have heard that the CCRC market is possibly faring the strongest of the seniors housing sectors. There has... Read More »
Misleading Information for Consumers
A professor with a new book on dementia care claims a semi-private room in a “decent” nursing facility in a big city costs $240,000 per year. Hogwash. I hate it when bad information gets out there, and a professor of psychiatry and bioethics at the Albert Einstein College of Medicine should know better. Especially someone coming out with a book called: Dementia Revisited: Building a Life of Joy and Dignity from Beginning to End.” Dr. Tia Powell published a story last weekend in The Wall Street Journal called “New Hopes for Dementia Care.” In it, she claims that the cost for a semi-private room in a “decent” nursing home in a big city is $240,000 a year if you don’t qualify for... Read More »
Blueprint and BlueMountain
Blueprint Healthcare Real Estate Advisors announced that it was involved in the Sabra Health Care REIT sale of 28 skilled nursing facilities in Texas and Louisiana to a joint venture of BlueMountain Capital Management, BM Eagle Holdings and Capital Funding Group for $282.5 million. Engaged by the joint venture buyer for their expertise on the Texas and Louisiana markets, Ben Firestone, Chris Hyldahl and Gideon Orion of Blueprint helped find local operating partners and tenants for the portfolio, which was previously operated by the now-bankrupt Senior Care Centers. Despite the bad news surrounding SCC’s financial troubles, these facilities were still operating decently well, particularly... Read More »
Greystone Refinances on the Jersey Shore
It was a team effort from Greystone to successfully close a Fannie Mae refinance of an assisted living community on the New Jersey Shore. Working on behalf of the borrower, Sage Healthcare Partners, Greystone’s DJ Elefant originated the $24 million loan, with Neal Raburn providing support in structuring, underwriting and closing the transaction. The 10-year loan (with a 20-year amortization and two years of interest only) replaces the original bridge loan provided by Greystone to enable Sage Healthcare Partners to acquire the property in 2017. Originally built in 1949 and renovated in 1997, the six-story community also had one floor converted to memory care in 2010. Back then, it was owned... Read More »
HHC Finance’s March Madness
Housing & Healthcare Finance posted a strong month in March with six HUD transactions closed for skilled nursing facilities in Florida, New Jersey, New York and Texas, plus one for a 156-bed supportive living facility in Illinois, all totaling $62 million. The Illinois closing marked the fifth supportive living HUD closing for HHC Finance in the last 12 months, an impressive stat given the small size of the market. Not resting on its HUD laurels, HHC Finance also announced that it placed about 15 bridge loans totaling more than $150 million in the first quarter, alone. They were closed by the firm’s Capital Advisory Group, led by Isaac Haas and Neil Gamss. Read More »Recent Senior Care M&A Deals, Week Ending April 12, 2019
Check out our recent senior care M&A deals! Long-Term Care AcquirerTargetPrice Owner/operatorSkilled nursing facility in Newark, OH$6.8 million Owner/operator5 NC skilled nursing facilitiesN/A The Springs LivingThe Springs at Carman Oaks & The Springs WilsonvilleN/A Partnership buyerWaterton Plaza at Cowhorn... Read More »
Being Public in Senior Care
In the first of his Fireside Chat series, our Editor Steve Monroe takes a deeper look at one of the pressing questions facing the senior care industry these days, is it worth it to be publicly traded in this space? Be sure to stay tuned for more Fireside Chats in the coming months, when Steve will give his thoughts on topics like the future of REIT financing, risk-taking in the market, and the role that CEOs and other C-Suite members should be playing in their companies... Read More »
Senior Housing Properties Trust Still Falling
It has been more than a week since Senior Housing Properties Trust (SNH) and Five Star Senior Living made their announcement about a complete restructuring of the relationship. Five Star’s shares have not recovered, nor were they expected to. But for Senior Housing Properties Trust it has been down, down and down. SNH’s shares have dropped for eight days in a row since the announcement, for a cumulative loss of 29%, so far. And the share price is down 40% from its 2019 high of $14.25. At the low end of the estimated range for the new dividend rate (55 cents to 65 cents annually), the yield would now be 6.3%. That is down from the current 18%. But actually, a 6.3% yield may be too high for... Read More »
PGIM Refinances Kentucky Communities Through Fannie Mae
Christopher Fenton of PGIM Real Estate Finance originated the refinances of two Morning Pointe assisted living/memory care communities in Kentucky. This transaction comes just two years after both communities were built, so the market research clearly worked since occupancy has already cleared 90% at the two locations. There was a 60-unit AL/MC community in Danville, Kentucky located near a regional medical center and a 44-unit memory care community in Russell, also located near a top Kentucky hospital. So, location clearly helped too. Working with Fannie Mae, PGIM provided a $7.5 million loan for the Danville property ($125,000 per unit) and a $7.8 million loan for the Russell community... Read More »
How Occupancy Impacted 2018 Assisted Living Values
As we’ve mentioned several times, 2018 was a tough year for assisted living occupancy, as new development took its toll on a number of markets. Low occupancy often leads to lower operating margins and less cash flow, especially when operators feel the need to heavily discount their rates in order to fill beds, so it’s a serious issue for the industry. In our Seniors Housing Acquisition & Investment Report, “stabilized” means having an occupancy equal to or higher than 85%. And while there are some operators not pleased with their “stabilized” communities occupied in the 80s, it could be worse, and there was clearly a premium paid for existing census in 2018. Stabilized communities sold... Read More »Schedule a demo
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