Sell while the iron’s hot
Continuing the firm’s impressive run so far this month, Jacob Gehl and Connor “Scratch Golfer” Doherty of Blueprint Healthcare Real Estate Advisers handled the sale of a 60-bed skilled nursing facility in Ironton, Ohio that was operationally under par. Both the census (which stood at 75% as of the end of 2015, but has been trending upward since) and cash flow (which was negative) could be improved at the 60-year old facility and required the right kind of buyer. Helping the buyer’s cause is that the facility was substantially rehabbed in 1985 and significant improvements have been made since then as well. Blueprint helped orchestrate the partnership buyer, which included a regional... Read More »
County cuts
Not all Northeast nursing facilities sold for near the regional average price per bed in 2015 (which averaged $94,100 per bed). A case in point, New York’s Warren County recently sold its struggling 80-bed skilled nursing facility in Queensbury for approximately $2.3 million, or $28,750 per bed. In 2014, the facility reported a significant loss despite being 92% occupied with a 21% quality mix. But, having been built in 1979, it could use an upgrade and some expense cuts. So it goes for many county-owned nursing facilities. Read More »
Allure of Brooklyn
Post-acute care is diversifying and specializing in more ways than one. A 200-bed skilled nursing facility in Brooklyn, New York recently opened a new 50-bed rehab and skilled nursing unit tailored to the needs of the local Chinese population. Called Longevity Garden, the fifth floor unit of the facility will feature a Chinese-inspired design, a menu consisting of Chinese entrees prepared on site and both Mandarin- and Cantonese-speaking staff, along with other dialects. The facility’s owner, The Allure Group, has been growing fast in the Brooklyn market, with five skilled nursing facilities in the borough (the fifth having been added in early 2015 at a cost of $36 million, or $132,841 per... Read More »Build up downtown
We have heard from some that there is a huge opportunity for urban seniors housing, with more seniors, and eventually (and we mean years down the road) desiring to live in a downtown setting, surrounded by shops, restaurants and entertainment outside of their own building. A few examples of developers looking to satisfy this in a big way are The Clare of Water Tower (the 53-story CCRC in Chicago that cost approximately $270 million to build) and Maplewood Senior Living’s latest development in Manhattan (with 20 stories and 214 units at a cost of $246 million), to name a couple. Columbia Pacific Advisors, a Seattle-based alternative investment firm, is now planning a 24-story, 237-unit... Read More »New life for Pasadena ALFs
Shep Roylance of The JCH Group recently facilitated the bankruptcy sale of three assisted living communities in Pasadena, California. The portfolio featured a 70-unit/136-bed community built in 1951, a 20-unit/40-bed property built in 1940 and a 30-unit/60-bed community built in 1956. They are as old as the Baby Boomers. Occupancy ranged from 85% to 92% among the properties, but they could all use some capex. The three California LLC owners filed for bankruptcy protection in late 2015 and the auction and sale hearing were in January 2016, facilitated by Mr. Roylance. SYTR Real Estate Holdings, LLC was the buyer and will look to increase census and acuity at the communities. They paid $10.9... Read More »The affordability factor
One issue that we haven’t heard a lot in the sessions at the last couple of NICs is affordability. Much of what is currently being constructed today is a high-end assisted living/memory care product that is all private pay. And on the skilled nursing/transitional care side, developers like Mainstreet are looking to take on majority Medicare or private pay patients into their luxury rehab resorts. But what about that segment of the population that cannot afford most of the seniors housing and care options out there? And what about those luxury communities that simply can’t draw a large enough census of people who both want to leave their homes and can pay for it? These, among other... Read More »
Cascade’s building blocks
New entrant Cascade Capital Group recently acquired three skilled nursing facilities in Colorado and Utah, as reported in the February issue of The SeniorCare Investor, and turned to Oxford Finance to fund it. Formed in January 2016 by the leadership team that built Illinois-based Legacy Healthcare, Cascade is a private equity firm that invests in long-term care facilities, with Legacy managing. The three acquired facilities were relatively new, being built between 1999 and 2013, but operated at a 12% margin and were just 58% occupied overall. Cascade paid approximately $31.8 million in total for the two Utah facilities and the one Colorado facility, or about $70,000 per bed. Ryan Saul and... Read More »
Blueprint to success
Blueprint Healthcare Real Estate Advisors has been on sort of a roll lately. We are only a third of the way through March, and already the firm has announced six transactions worth over $69 million. That includes both assisted living and skilled nursing too. The two most recent transactions, announced during NIC, jumped coast to coast. First, in Chicopee, Massachusetts, Steve Thomes and Tim Cobb teamed up to sell a 68-bed skilled nursing facility that had been owned and operated by a local provider since 1989. At the time of the sale, the facility was 92% occupied with a 20% quality mix. An experienced regional operator looking to grow its presence in the state was the buyer and paid $3.85... Read More »Senior Care Investment Rebound
After a dismal first six weeks this year, stocks have rebounded in a big way. Many of you know that I have been talking and writing about the change in investor sentiment that was taking place from late last year and into 2016. It really culminated in mid-February when pretty much all the senior care provider stocks and REITs collapsed to their new lows. It was all rather depressing, but also counterintuitive because things were not all that bad at the time. Sure, there was some negative news, but the overreaction in the market was just plain astounding. Many people thought it represented a major buying opportunity, even though they were still nervous and wondered if we were really at the... Read More »
Diamond in the rough
A not-for-profit health system in Alabama, the East Alabama Medical Center, recently exited the assisted living market, selling their three assisted living/memory care communities all located in Auburn. Featuring the only memory care beds (with 84) in the county, licensed as “Specialty Care Assisted Living,” these facilities were built between 1996 and 1999. Under the hospital’s ownership, expenses and staffing ran high, and census suffered party due to insufficient marketing efforts. There was still about $700,000 of EBITDA on $5.9 million of revenues, with 85% occupancy based on units, but those could both be improved under new ownership. The buyer was a partnership between private... Read More »Schedule a demo
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