KeyBank goes big with HUD
Formation Capital went to KeyBank Real Estate Capital to refinance a 22-property skilled nursing portfolio located in Florida (17 facilities) and Mississippi (five). With a total of 2,682 beds, the facilities were purchased in February from GE Capital. John Randolph and Paul Di Vito of KeyBank arranged $249 million in HUD financing, which will help pay down an existing bridge loan that funded a 66-facility acquisition. Read More »Out with a bang
In an otherwise quiet month, August was bookended by two large seniors housing deals. Starting the month, of course, was Welltower’s $1.15 billion acquisition of 19 Vintage Senior Living properties. And ending it was Investors Real Estate Trust’s (IRET) exit from the industry with the sale of 26 seniors housing properties located throughout the Upper Midwest. Totaling 1,751 rentable units, these properties were located in Wyoming, Minnesota, Montana, Nebraska, North Dakota and South Dakota. Affiliates of the current tenant of 25 of the 26 properties, Edgewood Senior Living, are the buyers. Also included in the $236 million, or $134,780 per unit, price was one multifamily property in... Read More »
Closing in Cordele
The sole assisted living community in Cordele, Georgia, sold to Omega Healthcare Investors when its Florida-based partnership owner decided to exit the Georgia market. Built in 1987 and 1996, the community features 38 personal care and eight independent living units, and has historically been well occupied, currently standing at 93%. Its 20% operating margin on approximately $1.4 million of revenues could be improved, and the buyer, with Fellowship Senior Living (its existing South Georgia operating partner), is planning on $500,000 in capital improvements. The purchase price comes in at $2.5 million, or $54,348 per unit, with a 12% cap rate. Brad Clousing and Patrick Burke of Senior... Read More »TLC and Seniors Housing
Lancaster Pollard’s Propero® Seniors Housing Equity Fund II is in the news again. BMO Harris Bank’s Commercial Real Estate Healthcare group recently closed a $30+ million construction loan for the development of a 242-bed assisted living/memory care/skilled nursing facility in Ocala, Florida. TLC Management, an owner/operator of skilled nursing facilities and seniors housing communities for nearly 30 years in Indiana and Florida, is developing the property with Propero, which provided the equity. Read More »
Home Healthcare Is Not The Answer
Costs are rising everywhere, putting increased pressure on seniors’ choices. So, what’s happening in the home healthcare world? On the one hand, you have CMS cutting Medicare payments, with MedPAC suggesting the cuts should be even higher. In addition, wages rates are rising, and home care workers in Washington state have won a $16 per hour wage in the future. On the other hand, new home healthcare startups are raising a lot of money, including $42 million earlier this month by California-based Honor, which is expanding into Texas. And then we read about a small home health provider in California who decided to get into the seniors housing business because home health has become too... Read More »
The REIT Recovery
Back in mid-February, it looked as if the world of healthcare REITs had collapsed, with no end in sight. Almost every healthcare REIT hit a new low in a span of a few days, but it has been a vastly different story in the six months since then. The average healthcare REIT stock has jumped in price by about 50% since mid-February, with a range between 27% (Care Capital Properties) and 78% (Sabra Health Care REIT). While that means the higher-yielding REITs have dropped down from double-digit yields, the range of dividend yields is still a healthy range of 4.1% to 8.5% (at least for investors). Price pressure will certainly pop up again if the Fed does increase rates next month, but no one is... Read More »
Love in Carrollton
A new independent living community is being developed in Carrollton, Texas, with the help of a $26.3 million HUD construction loan arranged by the team at Love Funding. Sitting on 5.5 acres in the Dallas-Fort Worth area, this community will feature 183 apartments and five stand-alone cottages, as well as a clubhouse and other amenities. The 40,000-member Prestonwood Baptist Church is also located across the street, which should provide a boost to occupancy. Laura Saull-Smith of Love secured the financing, which came with a 40-year term. An ownership group is behind the development, which includes principals Charlie Nicholas, Luke Harry, Steven Rumsey and Chris Willhite. Read More »Minnetonka mania
Three seniors housing developments are breaking ground this summer in the Minnetonka, Minnesota area. First, United Properties started construction on its 100-unit community, which will include 72 independent/assisted living units, 22 memory care units and six care units. Then, Oppidan Investment Company and Minnesota-based not-for-profit Ebenezer announced the expected September groundbreaking of their newest community, a 136,000-square foot, 105-unit community that will feature independent living, assisted living and memory care. Finally, The Waters plans to break ground in nearby Excelsior on its new 110-unit independent living community by the end of the year. We will see how these... Read More »
Development for Denver joint venture
A joint venture between three different parties enlisted the help of Aron Will from CBRE to help finance a to-be-built senior living community in Denver, Colorado. Blue Moon Capital Partners, MGL Partners and Leisure Care are set to break ground in September on a 163-unit independent living, assisted living and memory care community located near the heart of the Denver Tech Center. Mr. Will secured a $28.7 million, non-recourse floating rate loan, with a six-year term and 48 months of interest only, provided by a regional bank. The community is set to open in Spring 2017. Read More »
Propero: Part Two
For those owner/operators that wish to grow their portfolio by development, but also limit the capital needed to get the project started, there is an unconventional option. Launched in 2012, Lancaster Pollard’s first Propero Fund invests in seniors housing properties as the sole owner and then triple-net leases them to an operator, which will then choose from a predetermined purchase option schedule when to acquire the community at a price based on Propero’s investment basis rather than the current fair market value. The success of the product means Lancaster Pollard has moved on to its second Propero fund, which approximately doubles the size of the first in terms of equity commitments.... Read More »Schedule a demo
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