Back to Sims
A couple of years after purchasing two Rhode Island skilled nursing facilities, Athena Health Care Systems has gone to HUD to refinance the two properties, with the help of HJ Sims. Totaling 280 beds, the skilled nursing facilities combined for an occupancy in the mid-90s. This was not the first time Sims had gotten involved with these facilities. In fact, when Athena acquired them in 2013 and 2014, Sims issued both conventional bank financing and preferred equity to fund the deal. But, the bank debt was scheduled to mature in 2020 and 2021, respectively, and Athena chose to refinance through HUD to take advantage of the current low interest rate environment. So, Sims Mortgage Funding... Read More »Quantity over Quality?
What is the added cost of purchasing a portfolio of assisted living communities versus single-facilities? That is a question we try to answer in our Senior Care Acquisition Report (now in its 21st Edition). Now, there is no guarantee that a buyer will pay more for a portfolio of properties, but rather, the premium has to do with both the number of properties and the quality. For statistical purposes, we define “portfolio” sales as those sales with three or more properties. Most years, there is a sizeable difference between the average price paid for portfolios compared with smaller purchases. In 2015, we recorded one of the largest premiums in recent years of $47,600 per unit, or a 30%... Read More »
Continued Uncertainty At HCP
Lauralee Martin is out as CEO, but who will be in remains a mystery. The only thing surprising about the “sudden” announcement that Lauralee Martin stepped down as CEO of HCP, Inc. was that the effective date of her departure was also the announcement date. Now, we don’t want to read too many tea leaves into the situation, but remember that she came into the CEO position from the Board nearly three years ago in a tumultuous dumping of the previous CEO. She already had a top job at another real estate company and didn’t really need the aggravation. But she steered the REIT through another tumultuous period with, first the two lease adjustments, and then the in-process spin-off of the $6... Read More »Bridge with Love
A new 62-bed assisted living/memory care community is being developed in Ogden, Utah with the help of a $6.63 million bridge construction loan arranged by James Vanar of Love Funding. The loan, which was provided by Love’s parent company Midland States Bank, is expected to be taken out in three years by a HUD refinance. It also allows the developer, Utah-based Giza Development, to start the project sooner and begin accepting residents. Since introducing the bridge loan program in May 2015, Love has already financed over $65 million in bridge loans, not including $300 million of loans in its pipeline. Read More »Two Louisville-area assisted living communities sold
Allen McMurtry, Megan Fetter and David Kliewer of Cushman & Wakefield’s Tampa office represented Senior Care US Holdings, Inc., in the sale of its two assisted living/memory care communities near Louisville, Kentucky. Both communities have been operated by Elmcroft Senior Living since opening in 2012, with one featuring 56 assisted living units, 24 memory care units and a 99% occupancy, and another consisting of 31 assisted living units and 34 memory care units at 85% occupancy. Capital Health Group LLC was the buyer on behalf of a joint venture between Hunt Realty Investments and the Teacher Retirement System of Texas. Read More »
HFF closes high value deal in Northeast
Holliday Fenoglio Fowler, L.P. (HFF) closed one of the most expensive seniors housing transactions ever (on a per-unit basis), with its sale of two assisted living/memory care communities in the Northeast for $98.25 million, or almost $575,000 per unit. There were several factors that led to this near-record price. First was the location. One of the properties is located in suburban Philadelphia and the other is in New Jersey within the New York City MSA, both high barrier-to-entry, high-income markets. Second, they were recently built in 2013 by the owners, a joint venture between Formation Development Group (an affiliate of Formation Capital) and Shelbourne Healthcare Development Group... Read More »
Ensign’s quiet 2016
The Ensign Group (NASDAQ: ENSG) has cooled off significantly in 2016, following its 23 transactions in 2015. The company has only closed three deals so far this year, including its purchase of the Legend Healthcare properties (with eight skilled nursing facilities in Texas) and a small hospice operation in Iowa. Most recently, Ensign acquired a 171-bed skilled nursing facility in Kansas City, Kansas, which included the operations and the underlying real estate, for an undisclosed price. The facility includes a 10-bed assisted living unit, and was 56% occupied under the ownership of a faith-based not-for-profit. Ensign’s subsidiary, Endura Healthcare, Inc., will take over... Read More »Blue Moon pays up out West
We discuss in the July issue of The SeniorCare Investor the lack of high-valued transactions in June (and for the rest of the year), but one notable exception was Blue Moon Capital Partners’ acquisition of two assisted living communities in high barrier-to-entry markets in California. Belmont Village Senior Living developed the two assisted living/memory care properties in Thousand Oaks, California and Scottsdale, Arizona. Built in 2011 and 2012, respectively, the communities were close to full occupancy by the time of the sale. Blue Moon Capital Partners, which matches institutional capital investors with seniors housing operators, was the buyer, with Belmont Village owning a minority... Read More »Develop in Dover
LCB Senior Living is breaking ground on its 12th development next month in Dover, New Hampshire, with the help of a couple of partners. Cushman & Wakefield Senior Housing Capital Markets arranged a $15.1 million non-recourse construction loan to fund the development of the 76-unit senior living community. Sitting of 19.4 acres in a mixed-use development, which includes a new hotel, a medical office building, a bank and coffee shop, the building will feature independent living, assisted living and memory care services. Berkshire Bank provided the loan to LCB and its joint venture partner, Blue Moon Capital Partners. Read More »
Seniors Housing and Record Low Interest Rates
The 10-year Treasury note rate hit a record low, but is that good news or bad? In case you haven’t noticed, the 10-year Treasury note rate, which is used for pricing many debt instruments, has fallen to a record low. Anything between 1.50% and 2.00% was considered to be Nirvana for seniors housing borrowers. But the 10-year rate has now dropped below that range, and has been flirting with 1.35%. Remember talk about rising interest rates? Yes, at some time it will happen, but that time seems to be getting pushed out into the more distant future with each piece of bad news. So for seniors housing borrowers this may appear to be good news. Except once you get beyond the euphoria of your... Read More »Schedule a demo
Gain access to the best healthcare and long-term care investment intelligence, data, and analysis.
