Monticello’s Kentucky Closings
To fund its acquisition of two skilled nursing facilities in Kentucky, an investor turned to Monticello Asset Management to arrange financing. Two of Monticello’s investment vehicles originated $8.375 million in first lien debt financing and a $1.5 million working capital loan on behalf of the buyer, Healthcare Management KY, LLC. The two facilities total 139 skilled nursing beds (147 licensed beds) and eight personal care beds, and average over 20-years old. One of them was renovated in 2014, receiving a brand-new 2,500-square foot rehab gym. The new owner, whose principals have over 10 years of combined experience in the health care industry, expects to eventually refinance with... Read More »
Skilled Nursing Staffing Woes
Another front page New York Times story highlighting problems with skilled nursing facilities. I am sure many of you saw the recent New York Times article about understaffing in the nation’s nursing facilities, particularly on the weekends. The new methodology used, based on actual payrolls obtained by Medicare, indicates that staffing is 12% lower than using the previous methodology, which was based on self-reporting. The article used one small nursing facility in New York as an example of weekend staff shortages. Anecdotally, my next-door neighbor’s mother was in a local assisted living community operated by a prominent national chain, and she always complained about the “Sunday dump... Read More »
To Be Public Or Not
There are a lot of people who do not believe seniors housing and care companies should be publicly traded. It is not appropriate to try to manage quarterly revenues and profits when you are taking care of older, frail residents. And don’t forget the earnings disruptions that can be caused by new developments and the ongoing depreciation expense if you own your real estate. It is just difficult to please investors and analysts with all the variables, including external ones that you have no control over, or so the argument goes. And then there is the roller coaster of daily stock prices. Take Genesis Healthcare, as an example. This past Monday, its price plunged by as much as 19% on trading... Read More »
Evans Senior Investments’ Tar Heel State Transaction
A publicly-traded REIT divested a non-core skilled nursing facility in North Carolina. They were represented by Evans Senior Investments, which brought in a growing regional owner/operator as the buyer. Located in a tertiary market outside of Charlotte (in the town of Gastonia), the facility was operated by a national operator but averaged just 70% occupancy at the time of the sale. This offered an opportunity for the new owner to reposition the facility in the local market and improve census (and add value, of course). Paying $7.0 million, or about $59,000 per bed, the buyer expanded its presence in North Carolina. Now, the work begins. Read More »
New Jersey Owner Charges Ahead in Petersburg, Virginia
A senior living operator is growing its portfolio outside of the Garden State for the first time, in a deal facilitated by Andrew Hilding, Josh Jandris and Mark Myers of IPA Seniors Housing. The target is located in Petersburg, Virginia, and features a 39-unit assisted living community and a 32-unit memory care community on the same campus, with 102 total licensed beds. It was previously owned by a large operator that primarily serves the Midwest and mid-Atlantic regions. This is the buyer’s first community outside of New Jersey, which will look to enhance operations and make necessary improvements at the property. Read More »
Second Quarter M&A Soars Above 100 Deals
Boosted by an especially strong April, senior care M&A in the second quarter skyrocketed above 100 transactions for just the second time ever, according to DealSearchOnline. The industry seemed to be in a deal slump over the past year and a half, never surpassing 81 deals in a quarter and falling way off the pace set in 2015 when we recorded 99 deals in Q3:15 and 108 deals in Q4:15, the all-time record. However, this April set the tone for the quarter with 47 deals announced. Activity petered out a bit as the quarter wore on (35 deals in May and just 22 in June), but that could be the effects of the summer lull. Either that, or everyone was deal-ed out by Memorial Day. In the end, we... Read More »
Senior Living Investment Brokerage’s Summer Surge
As the temperatures rose, the team at Senior Living Investment Brokerage heated up too, following up its portfolio closing in Florida with two deals in the Lone Star State. First, in east Texas, Matthew Alley worked with an independent owner/operator to sell their long-held skilled nursing facilities in Grand Saline and Athens. Built in the 1960s, the facilities were operating just above breakeven on approximately $3.5 million of combined revenues. The 76-bed facility in Grand Saline was 65% occupied, while the 82-bed Athens facility had run into some major regulatory issues and was just 52% occupied. Another independent owner/operator based in the Dallas/Fort Worth area stepped in as the... Read More »
Blueprint Sells Four Assisted Living Sites in California
Blueprint Healthcare Real Estate Advisors proved they don’t need a building to sell a piece of property. When EB-5 investor PDC Capital’s assets were placed into an SEC receivership in January 2017, per the order of a federal judge, included in the frozen assets were four assisted living development sites in California. Thomas Seaman and Associates, the receiver, hired Blueprint to locate a stalking horse bidder for the sites. Carefield Senior Living emerged as that bidder and purchased three of the sites for $6 million. The existing first mortgagee, Lincoln MCC US, LLC, a division of MCC China, ended up surpassing Carefield’s bid for one of the sites, and paid $8.7 million for it. Jacob... Read More »
Ensign’s Idaho Acquisition
The Ensign Group picked up a struggling skilled nursing facility in Idaho, taking over both the operations and real estate. The 40-bed skilled nursing facility is located in the resort town of McCall (situated on Payette Lake) in western Idaho. Previously operated by Tanabell Health Services, it was just 70% occupied at the time of acquisition. The Ensign Group brought in its Pacific Northwest-based subsidiary, Pennant Healthcare, to take over operations. No purchase price was disclosed. Read More »
Will Brookdale Be Back In Play?
With agreements nailed down with its major REITs, buyers may start sniffing around again at a leaner and more profitable Brookdale. The announcement last week during the ASHA mid-year meeting, that Brookdale Senior Living had come to several agreements with Welltower on their various leases, was met with relief and renewed optimism for the seniors housing sector. Last Friday we reported on the details of the agreements, but most people we spoke with were hoping that as Brookdale’s financial pressures ease, the negative sentiment it had created for the industry will also start to dissipate. In addition, with the change-of-control roadblocks by the Big Three REITs now gone, always used as an... Read More »Schedule a demo
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