Drever gets its pipeline off the ground
We wrote earlier this year of Drever Capital Management’s seniors housing ambitions in both the acquisition and development markets. The company, which has only recently shifted its focus from multifamily to seniors housing, had already made its first acquisition in 2012, purchasing a 124-unit independent living community in Lexington, South Carolina with just 50% occupancy. That deal happened to be a perfect example of Drever’s acquisition strategy of purchasing struggling communities, injecting some capital improvements ($3.7 million in this case) and hiring an operator (Renaissance Senior Communities) to improve census (it is up to 90% now) and maximize revenues. Since then, Drever has... Read More »Converted convent sells in Wisconsin
Meridian Senior Services recently purchased a 50-unit assisted living community in Racine, Wisconsin (between Milwaukee and Chicago) for $6.5 million, or 130,000 per unit, with a 12.3% cap rate. The community has quite a history. The main building was built in 1924 originally as a convent, but was completely gutted in 2008 to provide assisted living. Currently, the 64,000-square foot building sits on 4.07 acres. The seller, which bought the property in 2007 and spent approximately $2 million for the conversion, is a local operator. Despite the renovation, the older structure of the building means the rooms are on the small side and there is not much common area, hence the higher cap rate.... Read More »Ziegler’s $1 billion relationship
Senior Quality Lifestyles Corporation (SQLC), a Texas-based nonprofit that operates six senior living communities, hired Ziegler for the fourth time in 2015 to refinance one of its properties, which is located in the Barton Creek neighborhood of Austin, Texas and consists of 157 independent living units, 10 IL villas, 40 assisted living units, 23 memory care units and 42 skilled nursing beds. In order to refund $37.7 million in outstanding Series 2005 Bonds and finance renovations on the property, including a restoration project, SQLC turned to Ziegler to close a $50.69 million tax-exempt bond issue. The financing also helped fund a debt service reserve fund, pay the cost of issuance and... Read More »Fraud And Senior Care
Despite some high-profile allegations against senior executives for some type of financial wrong-doing, we are still thankful for all the good work done by the nation’s caregivers. What is it about caring for the elderly and financial fraud or other misdeeds? About once a week I read about a home health agency being charged with Medicare fraud. And then there is Medicaid fraud we hear about all too often with nursing facility owners, doctors and other providers. In our senior care industry, the founder of Sunwest Management, Jon Harder, was sentenced last week to 15 years in federal prison. Also last week, the SEC charged Chris Brogdon, the CEO of Global Healthcare REIT, with... Read More »Four Green Bay-area properties sold
Jacob Gehl of Blueprint Healthcare Real Estate Advisors led the sale of a portfolio of four assisted living/memory care communities in Wisconsin for $18.35 million, or $146,800 per unit, with an 8.7% cap rate. Included in the portfolio were three properties in Green Bay, including a 20-unit stand-alone memory care community, and one in Appleton. Combined occupancy stood at 92% at the time of the sale, and the portfolio generated approximately $1.6 million in trailing EBITDAR on an annualized basis. Senior Housing and Healthcare Capital was the seller, while Summit Healthcare REIT was the buyer, which will lease the properties for a 12-year term to an affiliate of Compass Senior Living, an... Read More »Wolff eyes seniors housing
Another major multifamily developer is getting into the seniors housing industry. In the past year, we have seen a number of either private equity groups or real estate developers, all with experience in the multifamily market but not so much in seniors housing, dip their toes (some more like cannonballed) into seniors housing development, including Drever Capital Management, Alliance Residential and Validus Group. Now, Scottsdale, Arizona-based The Wolff Company announced its plans to develop six independent/assisted living communities with 858 units throughout the Western United States. To build up its seniors housing team, in March 2014 Wolff brought on Mike Milhaupt, who has over 20... Read More »The long road to HUD
A senior living community with a troubled financial past recently refinanced its debt with HUD via a $13.3 million loan. But how did it both sink so low and then turn around to be viable for a HUD refinance? Built in 2005, this 112-unit community, with independent living, assisted living and memory care services, is located in Madera, California, near Yosemite National Park. With Woodset Partners LLC as the owner and Integral Senior Living as the operator, the community received ALFA’s Best of the Best Award in 2010. Then, the problems began in 2013 when the community’s bank decided against extending its construction financing and sold the loan to a finance company which chose not to... Read More »From fixing to building
A company with extensive experience in turning around struggling senior living communities is now developing its first property and is pulling together all manner of financing sources in its capital stack. Solutions Advisors, which got its start in 2010 advising senior living communities on management, marketing and sales strategies, has already broken ground on its flagship community in Hamilton, New Jersey. With 96 independent living, 75 assisted living and 24 memory care units, the community is expected to cost a total of $59 million, or about $302,600 per unit, to develop. In addition, 25 of the IL units can be converted to AL down the road, if the need presents itself. To operate the... Read More »Funding the mission
Looking to refinance its outstanding debt, fund a renovation project and acquisition, and create a long-term financing plan with a reduced interest rate, nonprofit senior care operator Wellspring Lutheran Services enlisted the help of HJ Sims to close both a taxable bank loan and a tax-exempt bond issue. Already with five skilled nursing and assisted living communities operating in Michigan and a home health and hospice business in the state, Wellspring was looking to both improve and expand its mission. So, in order to fund those ambitions, HJ Sims arranged a $31.1 million taxable loan and $13.5 million of tax-exempt bonds. One regional bank provided the loan while another regional bank... Read More »High priced in Omaha
Chris Barnet of Colliers International’s Seniors Housing Group represented the owner in the sale of their 44-bed skilled nursing facility in Omaha, Nebraska. The buyer, Carter Validus Mission Critical REIT II, paid approximately $13 million, or about $295,500 per bed, which one of the highest prices ever seen in the SNF M&A market. How can such a price be explained? Well, the facility is brand new (purpose built in 2014) and is 100% occupied. Also, all of the beds are in private units, an attractive feature for Medicare patients. The facility offers a wide range of short-term rehab services, including physical, occupational and speech therapy, as well as transitional care services,... Read More »Schedule a demo
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