Arbor enters the seniors housing bridge lending game
With decades of experience in providing bridge loans for multifamily and commercial properties, Arbor Commercial Mortgage recently closed on its first bridge loan in the seniors housing industry, from its Arbor Realty Trust’s bridge loan product line. Jeff Ringwald of Arbor originated the $5.55 million bridge acquisition loan, which featured a three-year term and a floating rate spread 500 to 600 basis points over LIBOR, for Fields Senior Living to purchase an 88-unit independent living community in Medford, Oregon. The community was built in 1984 by Holiday Retirement Corporation and was owned and operated by the original financier for the project. Occupancy had dropped from near... Read More »The largest just got larger
The largest provider of skilled nursing in the country, Genesis HealthCare, increased its facility ownership to 23% of its inpatient sites with the acquisition of 24 skilled nursing facilities with 3,056 total beds for $240 million, or $78,500 per bed. The facilities, owned by Revera, Inc. and generating approximately $280 million in 2014 revenue, are located in New Jersey (8), Vermont (5), Washington (3), Connecticut (2), Massachusetts (2) and one each in Maryland, Virginia, New Hampshire and Rhode Island. Under the agreement, Genesis will acquire the real estate of 20 of the 24 facilities, and will enter into long-term lease agreements with Health Care REIT for the remaining four. In the... Read More »Where’s the beef?
There’s a lot of talk of hot, new technologies in the senior care industries that are poised to revolutionize delivery of care and drastically improve the lives of residents. But which of these innovations will be a flash in the pan, and which will show results? One serious issue that many seniors in assisted living face is the loss of strength and balance from a relatively sedentary life. One company, HUR, has developed computerized SmartCard exercise machines to help combat that loss of strength. Studies have shown that progressive resistance and balance training can significantly reduce the number of falls, and by increasing resistance by quarter-pound increments, the HUR machines make... Read More »Berkadia secures $93 million in financing
We wrote last month of ROC Seniors Housing Fund Manager’s purchase of 14 senior living properties with 1,038 units from a joint venture between Iron Point Partners and Meridian Senior Living for an undisclosed price. The portfolio was mostly assisted living (719 units), with 208 memory care units and 111 independent living units as well. To fund the acquisition, ROC turned to Berkadia to arrange an $84 million, three-year floating-rate loan through BBVA Compass Bank. Berkadia also contributed $20 million of the overall financing through its Proprietary Bridge Lending Platform. In addition, earlier this year ROC purchased a 76-unit assisted living and memory care community in Canton, Ohio,... Read More »What’s the memory care premium?
What is the premium paid for memory care in today’s seniors housing acquisition market? We have noticed in the last two cycles that at the beginning of the bull markets, traditional assisted living is typically priced higher than communities with a memory care component, then the reverse is true as the bull market strengthens or hits its peak. And given the extraordinarily high values we saw in 2014, we may have already been to the mountaintop. Accordingly, buyers paid a significant premium for assisted living with a memory care component, with $215,100 per unit compared with $138,500 for traditional AL in 2014 (according to the 2015 Senior Care Acquisition Report). What is interesting is... Read More »Seniors Housing Weekly Update- Are LTACs Gaming The System?
June 9, 2015. 60 Seconds with Steve Monroe. A new study appeared that seems to indicate patient discharges are influenced by the timing of Medicare reimbursement… Yesterday, The Wall Street Journal came out with a story on how it appears that patient discharges at long-term acute care hospitals (LTACs) have been timed to reimbursement payments. Specifically, to maximize those payments. The story was based on a study that appeared in the journal Health Affairs and had been reported on previously. Apparently, what the authors of the study noticed is that when the reimbursement methodology changed, between 2005 and 2010 for full implementation, there was a significant spike in the... Read More »Love Funding Building its Bridge program
Love Funding is making a splash in the bridge-to-HUD lending arena, a space where it has not seen much action before. Helped in large part by the late-2014 acquisition of its parent company (Heartland Bank) by Midland States Bank, Love gained access to a larger and more accessible capital platform. So the program was started this spring, with eight healthcare transactions (representing $78 million) already in the pipeline. The loans are split 50-50 between skilled nursing facilities and assisted living communities and are mostly for acquisitions (4), with a couple each for cash outs and new construction. The transactions are not limited to a specific region either, with four in... Read More »Sabra Collaborates with Leo Brown
Sabra Health Care REIT is getting more skin in the game in the development world, having announced a new pipeline agreement with Leo Brown Group (LBG) to help finance up to 10 new senior housing construction projects. Under the agreement, LBG will identify and secure construction financing for senior housing projects. Of those potential projects, Sabra will then have the right, through March 31, 2017, to provide a portion of the required equity financing for up to 10 projects through a preferred equity structure. Plus, at the time of the investment, Sabra will then obtain a purchase option for the community. The total purchase price for the projects is estimated to be approximately $250... Read More »LTC and Anthem expanding in Chicagoland
With four memory care communities already open in the Chicago metro area in the last few years, a joint venture between LTC Properties and Anthem Memory Care is on track to add three more communities in the next year or so. The first project is in Burr Ridge, features 66 units of memory care and will open later this year, with a cost of approximately $12 million, or $181,800 per unit (right around average for assisted living/memory care in Illinois, which is $188,700 per unit, according to our data). Second, LTC just recently closed on 3.5 acres of land in Tinley Park, Illinois for approximately $700,000, on which they plan to construct another 66-unit memory care community. The project,... Read More »Two Nebraska senior living communities top $300,000 per unit
Griffin-American Healthcare REIT purchased two relatively new, well occupied and well run senior living communities in Nebraska owned by Dial Retirement Communities for $66 million, or $300,000 per unit, with a 6.2% cap rate. The community in Omaha was built in the early 2000s and features 75 independent living units, 24 assisted living units and 15 memory care units with an occupancy of 98%. The community in Bennington, built in 2009 and 2013, features 39 IL units, 51 AL units and 16 MC units with an occupancy of 91%. Dial Retirement will operate the communities for Griffin-American under a long-term management agreement. Mark Myers and Joshua Jandris of Marcus & Millichap represented... Read More »Schedule a demo
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