April deal drought
The end of April saw a dearth of deals, until this transaction was announced (no price was revealed, but we’ll take it). Looking to expand its presence in the Iowa market, a Northeast-based owner/operator purchased two skilled nursing facilities in the state for $7.2 million, or $37,895 per bed, with an expected first-year cap rate of 13%. The 90-bed facility in the town of Washington was built in the 1970s, but had some renovations 15 to 20 years ago. The Muscatine facility has 100 beds and was also built in the 1970s, with renovations in the late 1990s and early 2000s. Occupancy was 80%, and both facilities had experienced regulatory issues. Despite that, the facilities operated at a... Read More »Big Sky gets big refi
In one of the company’s largest transactions closed in recent years, Denver-based Pineview Capital Group secured a $12.35 million HUD loan to refinance a 153-unit senior living community in Butte, Montana. The community was built in 1999 on a 13-acre property, with 102 assisted living units, 31 independent living units and 20 memory care units. There is also a 19% Medicaid census. Brett Patrick and Brian Therkildsen led the way for Pineview on this transaction. Read More »CareTrust’s buying spree
What has gotten into CareTrust REIT this year? When most other REITs are taking a significant step back in terms of buying, the California-based CareTrust has made 11 acquisitions, for 21 facilities, so far in 2016 (which already equals the number of facilities acquired in 2015). First, the company purchased two communities in North Carolina for $11.7 million, or $113,592 per unit, handled by Evans Senior Investments. The deal included a 16-year old 46-unit assisted living/memory care community and a 17-year old 21-unit memory care community. Premier Senior Living Group will operate the two stabilized properties. Next up, CareTrust bought a 175-unit independent/assisted living community in... Read More »
It takes a village
A number of hands are in the pot in an assisted living development that just broke ground outside of Tampa, Florida. The 80-unit community is being developed by Enriched Community Development, LLC, in partnership with North Carolina-based Retirement Living Associates, Inc., which will serve as the community’s manager. Plus, an investment group headed by Robert Gries Jr., the founder and managing director of Gries Investment Funds, is an equity partner in the project. The community will feature 58 assisted living and 22 memory care units, and is expected to open in Spring 2017. Enriched Community Development, through its affiliate Lithia Assisted Living, turned to Robert Hernandez of... Read More »
Everything’s bigger in Texas
In one of the larger financings seen so far this year, KeyBank Real Estate Capital recently provided a total of $202.1 million in Freddie Mac loans to refinance a portfolio of five independent living communities in Texas. Owned by a joint venture between Kayne Anderson Real Estate Advisors and Discovery Senior Living (which purchased it in 2014 for approximately $290 million, or $276,000 per unit), the “Conservatory Senior Living” portfolio totals 1,053 units, built between 2005 and 2007. Charlie Shoop and Carolyn Nazdin of Key’s Healthcare Mortgage Group, together with Pail DiVito of the Healthcare Real Estate Group, arranged non-recourse, 10-year adjustable rate financing to refinance an... Read More »Size matters
We all know that skilled nursing prices have hit an all-time high, averaging $85,900 per bed in 2015, according to the 21st Edition of The Senior Care Acquisition Report. So what was it about the facilities sold in 2015 that helped drive this price up? For one, the average facility was larger than it has ever been. At 130 beds, the average facility sold in 2015 was four beds larger than the previous record-high, shared in 2012 and 2014 at 126 beds per facility. Why does size matter when it comes to price? Unless it is highly specialized, either with rehab care or skilled Alzheimer’s care, most buyers do not like to invest in nursing facilities that are smaller than 60 beds, and some won’t... Read More »
Checking out Chetak
A city-owned senior care facility in Chetak, Wisconsin that was losing money sold to a New Jersey-based owner/operator rapidly growing its presence in the Badger State. The property features both a 97-bed skilled nursing facility that the City of Chetak built in 1963 and an adjoining 14-unit assisted living community that was added in 1997. Plus, there was a 2010 remodel of the kitchen, dining room, staff and resident lounges and the hallways throughout the building. However, occupancy had been falling in the previous years at the SNF, and the facility was losing money, compared to the assisted living, which posted positive net income. Occupancy stood at 86% at the SNF, with a 30% quality... Read More »
Senior living communities age too
It should surprise no one that as a seniors housing (assisted living and independent living) community creeps farther away from the day it opened its doors, its value typically falls in turn (this assumes several things, like local competition/demand and the general seniors housing market keeping steady and no significant renovations or additions being made to the building). But did this hold true in 2015? Largely, yes. According to the 21st Senior Care Acquisition Report, Seniors housing communities built in the last five years sold on average for the highest price, at $320,500 per unit. Then came those properties built between six and 10 years ago, which sold on average for $225,100 per... Read More »
Capital One goes to Princeton
Working with HUD, Joshua Rosen of Capital One originated a $5.9 million refinance for a 95-bed skilled nursing facility in Princeton, Indiana. Originally built in 1968, with an addition in 1974, the facility features 45 semi-private units and five private rooms, and was operated by a local hospital. It was certified by Medicare and Medicaid, which led Rosen to work with HUD on Medicaid’s Upper Payment Limit program. Available in only a few states, the program is a federal limit on fee-for-service reimbursement of Medicaid providers. This incentivizes the owner to have a local hospital serve as operator, thereby increasing Medicaid payments, which can be taken into consideration during the... Read More »
Triumph in Tucson
Making its second-ever acquisition in Arizona, Chicago Pacific Founders added a 140-unit independent living community in Tucson to its growing portfolio of now eight properties located across the country. Almost a year prior to this deal, CPF had entered into the Arizona market with its $7.2 million purchase of a 79-unit assisted/independent living community in Sun City. Also, just over the border in Nevada, CPF acquired a 72-unit assisted living community in Pahrump for an estimated $7.5 million. The newest property is located in a residential and retail area in southwest Tucson, and is close to several major medical centers. CPF plans to make investments in the community, and its... Read More »Schedule a demo
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