Recent Senior Care M&A Deals, Week Ending July 7, 2017
Check out our recent senior care M&A transactions! Long-Term Care AcquirerTargetPrice Joint ventureBlue Ridge Assisted Living$17 million The Ensign Group2 senior care communitiesN/A Harbert Seniors Housing Fund IMorningStar of Wheat Ridge and AlbuquerqueN/A Diversicare Healthcare Services, Inc.Park Place in Selma$8.75... Read More »QCP vs. HCRMC Heats Up
Other than its increased share price, the news does not seem to be getting better with regard to the negotiations between Quality Care Properties (NYSE: QCP), HCR ManorCare and the various stakeholders. After making only a partial rent payment for June because of liquidity concerns, it looks like HCRMC has skipped the July payment in its entirety. The two sides have been trying to negotiate a deal, which seems to be the acquisition or merger of HCRMC into QCP, which would wipe out the burdensome lease payments. Our guess is that they just can’t over a few of the major sticking points, which include the Department of Justice investigation and the unfunded deferred compensation totaling more... Read More »
Chicago Pacific Founders All-In in Las Vegas
For the third time in the firm’s three-year history, Chicago Pacific Founders is acquiring a senior living community in the Las Vegas market, with the help of financing arranged by Aron Will of CBRE. Located about 13 miles west of the Strip (and 3.5 miles northwest of Spring Valley Medical Center), the community features 160 units of about 80% independent living and 20% assisted living. Built in 1999, it will be operated by Grace Management, which believes it can improve on the census and operations. Mr. Will originated a $13.5 million Fannie Mae loan, with a seven-year term and 3.5 years of interest only, on behalf of CPF’s private equity arm, CPF Living Communities. One of CPF’s other... Read More »
After Filling in 30 Days, Georgia Assisted Living Community Sells
Brad Clousing of Senior Living Investment Brokerage sold a brand-new assisted living/memory care community in Blue Ridge, Georgia, which is already 100% occupied. In fact, the community filled in just 30 days after its October 2016 opening and has more than 20 people on the wait list with deposits made. Quite impressive. A local developer/operator built the community with 50 AL and 17 MC units, but the buyer, a joint venture between a Maryland-based fund and a Florida-based operator, plans to build a Phase II in response to the strong demand. And why not, with the community already operating at a 41% margin on approximately $3.1 million of revenues. Mr. Clousing sold the community for $17... Read More »
Ziegler’s June Surge
Ziegler impressed in June, closing over $350 million in tax-exempt bond financing for two CCRC clients. Buckner Senior Living was on the receiving end of the larger closing, a $232.5 million fixed-rate bond issuance to fund the development of its 325-unit entrance fee CCRC in the North Park neighborhood of Dallas. The luxury community is expected to cost around $136 million to build, or about $418,000 per unit. With that high cost comes a number of amenities like a roof-top garden, top-floor “Sky Lounge,” heated indoor pool and a salon/spa, among others. Placed on a three-acre parcel, the community will feature 189 independent living, 38 assisted living, 26 memory care, 48 skilled nursing... Read More »Kindred Healthcare Sells SNF Division To BlueMountain
Kindred Healthcare announced an agreement to sell 89 skilled nursing facilities with 11,308 beds and seven assisted living communities with 380 licensed beds for $700 million, or $59,890 per bed. In today’s world, that can be considered cheap, since it is nearly 40% below the average price paid per bed in 2016, but there is more to it than meets the casual eye, since there is a group of leased facilities outside of the Ventas-owned properties that will be purchased from Ventas as part of the larger transaction. However, occupancy stands at 78%, which is below the historically low current national average of about 82%. The buyer is private equity firm BlueMountain Capital Management, LLC,... Read More »
Jump In Senior Care Deal Volume
The dollar value of announced seniors housing and care acquisitions in the second quarter was more than six times the first quarter. I hope you all had a happy 4th of July and got to stretch it into a four-day weekend. We are now in the mid-point of the year, and while transaction volume may have slowed a bit, the investment dollars are picking up steam. After a slow first quarter based on announced seniors housing and care acquisitions totaling only $1.4 billion, the second quarter has seen a significant spike to more than $9.6 billion in deal value. That’s the highest quarterly level since the third quarter of 2014. Admittedly, 65% of the dollars committed last quarter involved just two... Read More »
Evans Senior Investments Handles Texas Transaction
Evans Senior Investments closed yet another Texas transaction this year, a month after closing a three-property, 221-unit assisted living portfolio sale there for $45 million. The firm represented an institutional group based on the East Coast in its divestment of a 77-unit assisted living/memory care community in the town of Missouri City (Houston MSA). The purchase price came to $14.35 million, or $186,000 per unit, which is below average for the sector, especially for a new community (it was built in 2010). However, this is where the issue of overdevelopment may be having its effect. Since opening, the community has averaged just 79% occupancy, albeit with a 100% private pay census. The... Read More »Paying Up For Square Footage In Skilled Nursing
The size of a skilled nursing facility can have important ramifications for the services they provide, especially as many facilities are engaging in higher acuity services and more frail patients. Four-bed wards and even triples became a thing of the past (mostly) more than 10 to 15 years ago. You need a lot more room to provide quality therapy programs, and with increasing demand for private rooms, or at a minimum large semi-private rooms, small facilities on a square foot per bed basis have become less desirable in the market, both for buyers as well as consumers. Most nursing facilities built today have at least 400 square feet per bed, and often much more. But in the past, many had 250... Read More »
Focus Healthcare Partners Closes New Dedicated Fund
Just eight years ago, Curt Schaller and Paul Froning formed Focus Healthcare Partners LLC to parlay their investment and financing expertise into an investment platform to buy senior living properties across the country in partnership with private equity capital sources. Since then, they have purchased 16 properties for more than $400 million, and have sold eight of them at what we believe to be a tidy profit. Several months ago, they decided it was time to form their own fund and went into the market seeking about $200 million. Apparently, they underestimated themselves and their track record. Focus recently closed on a $312 million discretionary real estate fund that will focus on the... Read More »Schedule a demo
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