Diversified Healthcare Trust Lives Another Day
One of the reasons provided for the misguided merger of Diversified Healthcare Trust with Office Properties Trust, since terminated, was that DHC needed to do it in order not to default on its debt and go Chapter 11. Afterall, they had issued a “going concern” letter early this year because they did not see any way to pay off their maturing debt in 2024. Oops. But in this case, it is a good “oops,” because they did manage to find a way to raise net proceeds of $732 million to pay off all their 2024 debt. The $941 million par value of zero coupon senior secured notes come with a rate of 11.25%, so this is quite expensive. The notes are due in two years with a one-year extension. But if the... Read More »
Another Large Portfolio Trades in December
As 2023 comes to a close, a spate of portfolio deals have closed between large, institutional parties. We usually see the end-of-year rush of closings, usually for tax purposes, but it has been unique for 2023 to see the larger size of some of the deals, as well as the institutional buyers, which have largely sat on the sidelines this year. Newmark’s latest closing featured seven seniors housing properties in three states: Michigan, Pennsylvania and Virginia. They consist of 931 units, with independent living, assisted living and memory care services. The newly-constructed assets are considered Class-A communities in desirable locations. They also experienced positive leasing and operating... Read More »
MIG Facilitates SNF Lease-To-Purchase Agreement
After owning and operating senior care facilities for decades, an ownership group seeking retirement from the long-term-care space enlisted Andrew Montgomery of Montgomery Intermediary Group to execute a lease-to-purchase agreement for a 40-bed skilled nursing facility in Missouri. The tenant/buyer was ANew Healthcare, a growing owner/operator run by Mark Hastings that is looking to expand its footprint in the region. ANew also closed on another lease-to-purchase deal in Missouri earlier this fall for a 60-bed facility. Montgomery handled that transaction, as well. The current deal featured a 40-bed SNF that was built in 1964 in southwest Missouri. Its occupancy had ranged from 70% to 84%... Read More »
SLIB Sells Improving Seniors Housing Asset in Scottsdale
An independent owner based in southern California enlisted Senior Living Investment Brokerage in the divestment of a seniors housing community in Scottsdale, Arizona. The Springs of Scottsdale is a 143-unit independent and assisted living community, with 56 licensed AL beds and the remainder serving IL residents. Built in 1986, the community has undergone recent renovations in excess of $1.0 million. Occupancy was decent at 81%, and so was the margin at 20% on $4.86 million of revenues. But the seller had used multiple management companies over the past few years, so some stability there could help things going forward. Stability was ensured when the seller chose to sell the community to... Read More »
60 Seconds with Steve Monroe: Not So Merry This Year?
As many of you know, this time of year I often do my “Twas The Night Before Christmas” roast of senior participants in our industry, picking on either REITs, brokers, provider CEOs, or anyone else. Somehow, this year it just didn’t seem appropriate. They have been picked on enough, but not in jest like I try to do, even though some seem to take it a bit too personally. You shouldn’t. It seems the media, in particular The New York Times and The Washington Post, have decided to pick on the assisted living industry, maybe figuring nursing homes have already been through the media meat grinder, which they have. Last weekend, The Post came out with two articles blasting the assisted living... Read More »
National Developer/Investor Divests in Kentucky
In a pre-COVID, value-add portfolio transaction, a national developer/investor acquired over 12 geographically disparate, older-vintage communities. The combined impact of COVID and an unforeseen rise in interest rates prompted a strategic portfolio re-prioritization, rationalization and de-levering effort, leading to the divestment of a seniors housing community in Fort Mitchell, Kentucky, that was a geographic outlier and deemed non-core. Built in the late 1990s, the community comprises 95 units of assisted living and memory care. Although it was performing, it was not fully stable from an occupancy or margin perspective, necessitating capital enhancements to achieve its full potential. ... Read More »
G Capital Markets Secures HUD Refinancing
G Capital Markets arranged the permanent refinancing of a skilled nursing facility with an assisted living component in Plum City, Wisconsin. The facility was originally built in 1987 and was renovated in 2005, with an AL expansion built in 2014. In total the project operates 65 beds in 41 private and semi-private units, with 70% SNF beds and 30% AL. The facility has performed strongly with occupancy consistently over 80% and a high debt service coverage of 2.5x. A 232/223(f) HUD takeout loan was funded to pay off the balance of a term loan portfolio credit facility previously structured by G Capital founder Grant Goodman. The buyer is an owner/operator based in Nevada that manages and... Read More »
An Investor’s Guide to 2024: Buy, Sell, Finance & Thrive in Senior Care
An Investor’s Guide to 2024: Buy, Sell, Finance & Thrive in Senior Care is a deep dive into the 2024 investment landscape in the seniors housing and skilled nursing sectors. Gain valuable insights, market analysis and strategic guidance to seize opportunities and navigate potential challenges in the long-term care market. The panelists included: Ben Swett, Managing Editor, The SeniorCare Investor (moderator) Bryan J. Lockard, MRICS, Executive Managing Director, U.S Healthcare & Alternative Real Estate Lead, JLL Value and Risk Advisory Jason Punzel, Managing Director, SLIB Chris Hollister, Co-Founder, CEO and Chair, Pegasus Senior Living Austin Sacco, Managing... Read More »
Coastal California Community Finds New Owner
Location, location, location. A seniors housing community sitting on the oceanfront in San Clemente, California, found a new owner with the help of Brad Goodsell and Jason Punzel of Senior Living Investment Brokerage. The 140-unit assisted living/memory care community was built in 2002 and comprises 131,765 square feet on 3.3 acres. Some improvements could be made to maximize the property’s scenic location and customer appeal. Occupancy was 82% at the time of the sale. Its owner chose to divest with the ultimate goal of exiting the seniors housing space. The seller’s family had developed it and managed the property through the sale. A joint venture between a private equity group... Read More »
CIBC Bank USA Closes Cash-Out Refinance
CIBC Bank USA provided a financing package for an improving skilled nursing facility in Kansas. The package included a cash-out refinance that comprised $9 million at closing and a $3 million earn-out based on sustained financial performance over subsequent periods. CIBC also closed a $1.5 million capital expenditure, non-revolving line of credit and a $500,000 working capital revolving line of credit. Historical performance trended positively over the last year as the facility improved census and operating leverage. The operator will also remain in place. Going forward, occupancy is expected to be in the mid-80% range, with continued improvement in operating margins. CIBC’s Daniel Forrer... Read More »Schedule a demo
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