Rocky Mountain High
On the heels of paying more than $500,000 per unit for an 85-unit assisted living and memory care community in the suburbs of Denver, Colorado, Kayne Anderson Real Estate Advisors purchased another community from the same seller, Confluent Senior Living, this time in Fort Collins. Given that this one opened its doors 30 months ago, we assume it went for a similar price even though the markets are different. A little smaller at 79 assisted living and memory care units, the seller’s operating partner, MorningStar Senior Living, will continue to operate it for Kayne Anderson. Confluent and MorningStar have completed seven previous projects together, in Arizona, Colorado, Iowa and New... Read More »
Off To The Races
Just as the horses were coming into the stretch at the Derby last Saturday, Blueprint Healthcare Real Estate Advisors was closing on the sale of two skilled nursing facilities in Kentucky. They were built in 1993 and 1999, and one of the facilities underwent a $1.7 million renovation in 2014. Combined occupancy was 80% with revenues of $10 million. The sales price was $7.5 million, or about $51,000 per bed. Chris Hyldahl, Gideon Orion, Michael Segal and Ben Firestone represented the California-based seller, and the buyer was ClearView Healthcare Management. Just to the south, Brooks Blackmon and Trent Gherardini of Blueprint sold a 120-bed skilled nursing facility in Butler,... Read More »
Greystone Goes To Canada
Greystone Real Estate Advisors closed back-to-back portfolio sales in Canada. Mike Garbers and Cody Tremper, together with TD Securities, represented the seller of 10 senior living communities located throughout the greater Toronto and Ottawa areas. The 10 communities had 1,245 units, of which 1,045 were independent supportive living and 200 were assisted living. All but two were built or renovated in the past 10 years. Sienna Senior Living paid $298 million, or $239,400 per unit (C$382 million). In their second transaction, they sold four communities in the greater Edmonton area in Alberta. The 775-unit portfolio included 450 independent supportive living units, 237 assisted living... Read More »Greystone Hat-Trick in New York
Fred Levine of Greystone closed three HUD financings on the same day for an acquisition of three New York skilled nursing facilities. The $75 million loan, which comes to $133,690 per bed, financed three nursing facilities with 561 beds. They included Brookside Multicare in Smithtown (353 beds), White Plains Center for Nursing and Rehab in White Plains (88 beds), and Little Neck Nursing Center in Queens (120 beds). The Smithtown facility includes a pediatric unit and ventilator beds. Read More »
Evans Finds The Solution
Evans Senior Investments (ESI) closed on the sale of two properties in New York known as the Robinson Terrace Portfolio. It included a 120-bed skilled nursing facility that was built in Samford in 1973, and a 55-unit assisted living community built in 2011 two miles away. Despite the rural location, occupancy had been relatively high, above 90% at both facilities. The problem, however, was the cost structure and the fact that the Medicaid census was high in both properties. The campus was owned and operated by a not-for-profit, and maybe because they were the low-cost providers in the area, the EBITA margin was a negative 20% or worse. High staffing costs combined with low Medicaid... Read More »
CFG Rolls Into Spring
Capital Funding Group hit the spring running, closing eight deals worth just under $109 million. Six of the financings were HUD and the remaining two were bridge-to-Hud loans. Craig Casagrande closed two HUD financings in New Jersey. The first was a $16.3 million HUD loan for a 176-bed skilled nursing and assisted living facility, and the second was a $21.3 million HUD loan for a 152-bed skilled nursing facility. He also closed an $8.4 million bridge-to-HUD loan for a 164-bed skilled nursing and assisted living facility in Ohio. Next up was Patrick McGovern, who also had a hat-trick. He closed a $12.9 million HUD loan in Michigan for two skilled nursing facilities with 178 beds,... Read More »
The 40-Year Old SNF
The skilled nursing sector is under pressure, especially those facilities built 40 years ago. But buyers continue to see opportunity. There are some people who believe skilled nursing facilities are dinosaurs and will continue to see declines in census and profitability. There are others who believe they are part of the solution to contain healthcare costs and will see census increases in the future as demographics evolve and the SNF bed inventory continues to decline. Within both sides of the debate, there is concern for the large number of skilled nursing facilities that were built 40 years ago. Can they be part of the solution? Is it worthwhile to invest capital in an outdated design?... Read More »
SNF Cap Rate Spreads
For the first year since 2014, the average 10-year Treasury note rate rose in 2017, and the increase was a relatively sizable 50 basis points to 2.3%. We say “relatively” because it has been so low and stable for so many years since the Great Recession that many investors have come to believe that interest rates will not rise significantly any time soon. That sentiment may be changing, however. The spread between the 10-year Treasury note and the skilled nursing cap rate was 1,000 basis points in 2017 (according to the 23rd Edition of The Senior Care Acquisition Report) and has essentially been around 1,000 basis points or wider since 2009. This fact alone is part of the reason... Read More »
Lancaster Pollard’s $88 Million Financing
Lancaster Pollard closed a large construction on behalf of Los Angeles-based Ridge Senior Living to build a new luxury senior living community in Lakewood, Colorado (Denver MSA). Once complete, the community will comprise 318 total units of independent living, assisted living and memory care. To fund its development, Jason Dopoulos, Ross Holland and Joe Munhall of Lancaster Pollard identified a national bank to act as lead agent on an $88 million construction loan, with a portion syndicated to other bank participants. The development will be Ridge’s fifth community, joining four other properties in California and Utah. Read More »
CBRE Finances Willows of Easley
Chicago Pacific Founders turned to Aron Will of CBRE to arrange financing for its latest acquisition in Easley, South Carolina. We reported last month that Evans Senior Investments had represented the independent owner/operator in its sale of a 100-unit independent/assisted living community. Originally built by the seller in 1997 and expanded in 2004, the Easley property was 96% occupied with 100% private pay and operated at a 36% EBITDAR margin. CPF bought it for $14.5 million, or $145,000 per unit, with the help of a $10.2 million Freddie Mac loan that featured a seven-year floating rate term and 42 months of interest only, arranged by Mr. Will. Grace Management will take over management... Read More »Schedule a demo
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