The Stratification of the Skilled Nursing Facility Market
We have talked a lot of skilled nursing prices reaching an unprecedented peak in 2016, at $99,200 per bed, per our just-released 2017 Senior Care Acquisition Report. But even though the average price per bed has risen to extremely high levels, there remains a large difference between those newly built skilled nursing facilities, as well as those with a very strong Medicare census, compared with lower-quality and older properties. In 2015, the upper quartile for skilled nursing pricing was $123,000 per bed, meaning that 25% of the skilled nursing properties sold were transacted above this price level. The upper quartile jumped again in 2016, this time by 15% to $143,300 per bed. Just five... Read More »
Senior Care And Labor
No talking about deals, values, stock prices and cap rates, not even Brookdale Senior Living. It’s time to talk labor. I know you usually hear me talking about deals, values, stock prices and cap rates, and let’s not forget Brookdale Senior Living. But I am going to digress a bit from the usual. The entire seniors housing and care business seems to be avoiding what I really believe is going to be a labor meltdown. Cost is one thing, and it is already impacting the bottom line of many providers. But the quality, the training, or lack of, is just something that I think is still missing, and it will begin to poke holes into the marketing pitch for seniors housing and care. For all of... Read More »
Cushman & Wakefield’s Deal Double
Showing off its range of services, Cushman & Wakefield closed a couple of transactions for clients in both Minnesota and Arizona. First up, David Rothschild and Mary Christian sold a high-quality senior living community in Woodbury, Minnesota for $22 million, or $285,714 per unit. Welltower bought the community, which opened in June 2015 with 39 independent/assisted living units, 32 memory care units and six care suites. Oppidan Investment Co. developed the community and had brought in Ebenezer to manage it. However, the buyer will put in place new management, which we believe will be New Perspective Senior Living. Occupancy was heading above 80% at the time of sale. For more... Read More »
Mainstreet Health Investments’ Growing and Shrinking Relationship with Ensign
Based in Toronto, Ontario with a concentration of properties in Chicagoland and Texas, Mainstreet Health Investments Inc. (MHI) is entering the California and Arizona markets with an acquisition from The Ensign Group. Featuring 381 units/beds, the portfolio includes two post-acute/skilled nursing facilities and a senior living community in the Los Angeles and Phoenix markets. Ensign, which we typically see as a buyer, will continue to operate the properties, now under an absolute net master lease with an initial 20-year term and CPI-based annual escalators. In the past year, Ensign has expressed a desire to own the real estate of more properties of its portfolio, however this transaction... Read More »Love Funding Fuels Senior Living Construction Project
James Vanar of Love Funding arranged a $6.8 million bridge loan for a new assisted living/memory care development in South Jordan, Utah. Giza Development leads the team, including Stout Construction and Primera Group, developing the 62-bed community, which will be operated by SAL Management Group. Midland States Bank, the parent company of Love, provided what is now the second loan for Giza (the first was for a development in Ogden, Utah in 2016). Since its launch in May 2015, Love Funding’s bridge lending platform has financed more than $153 million in closings and has another $220 million in loans in the pipeline. That should make for a busy 2017. Read More »Recent Senior Care M&A Deals, Week Ending March 10, 2017
Check out our recent senior care M&A transactions! Long-Term Care AcquirerTargetPrice VentasKoelsch senior living portfolio$137 million Chicago-based partnershipBrentwood Sub-Acute Healthcare Center$7.25 million Allied Services Integrated Health SystemMercy Skilled Nursing and Transitional Care UnitN/A Welltower Inc.Red Rock Senior Living$22 million ... Read More »
Buying in Burbank
It may have seen better days, but a skilled nursing facility in Burbank, Illinois sold to a pair of Chicago-based companies for $7.25 million, or $44,500 per bed. The 163-bed facility was sold by a New York-based owner of more than 180 skilled nursing facilities located across the country. In-place cash flow was negative at the time of the sale and occupancy had declined over the past few years. But that hasn’t always been the case, with local operators noting the well-maintained facility’s strong operations in the past, including back-to-back years of total revenue and EBTIDAR exceeding $10 million and $1 million, respectively. A partnership between a national real estate investor and an... Read More »
Koelsch Communities Expands Relationship with Ventas
Since its start in 1958, Olympia, Washington-based Koelsch Communities has grown its portfolio to 22 communities located in seven states. The company is also ratcheting up its expansion efforts in the next couple of years, with eight new seniors housing communities slated for completion in four states by 2018. Fueling this growth has been Koelsch’s relationship with Ventas, for which it operates 12 communities, but 18 after its latest transaction. Ventas purchased, then leased back, six seniors housing properties from Koelsch for $137 million. Five of the six communities had been originally developed by Koelsch Communities between 1993 and 2014, with the sixth (a 142-unit independent... Read More »
Columbia Pacific Stirs Up Indian Senior Care Market With Serene Purchase
India represents a huge untapped market when it comes to seniors housing, and a Seattle-based company already with significant investments in Asia is looking to capitalize. A subsidiary of Columbia Pacific Advisors (which was founded in 2006 by Alex Washburn, Stan Baty and Dan Baty), Columbia Pacific Management manages an international business that includes hospitals, clinics and senior care facilities in Kenya, Southeast Asia, India and China. Now, the company is making a huge investment in the Indian senior care market, which has an aging population, rising upper- and middle classes and an under-supply of senior care facilities. Columbia Pacific purchased Serene Senior Care and its 735... Read More »
What Are the Memory Care Investors Saying?
On March 9th, we hosted a webinar entitled “Building or Buying Memory Care,” with moderator Steve Monroe and panelists Clint Malin of LTC Properties, Mark Myers of Marcus & Millichap, Michael Stoller of LCB Senior Living and Matthew Turner of MorningStar Senior Living. The panelists covered a range of topics (you can listen to the discussion here) including the risks of overbuilding, effectiveness of memory care conversions and fill-up risk, among others. But our audience also chimed in, answering three poll questions throughout the webinar. First, when asked if they would build stand-alone MC, assisted living with MC or stand-alone AL, 60% preferred the mix, 32% would build... Read More »Schedule a demo
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