August Acquisition Volume Light, But Consistent
Can we call it a comeback when the seniors housing and care M&A market surpassed 20 deals in August? We recorded 21 publicly announced transactions in the month, which is the highest total since April when 22 deals were disclosed. Since April, there have been 20 deals announced in May, 18 in June and 20 again in July. Consistent, yes, but we just still aren’t used to seeing numbers like these after the heady times of 2018 and 2019 when buyers regularly made 40 transactions or more in a month. Through the end of August, the seniors housing and care M&A market reached 200 deals announced in 2020, so far. Roughly half of that total came in the first quarter, which was... Read More »
Diversified Healthcare Trust Divests Two Managed Communities
Diversified Healthcare Trust (DHC) divested a couple of its SHOP assets, both located in Mississippi and operated by Five Star Senior Living under the Hermitage Gardens name. Built around 2000 and renovated in 2005, the properties include a 57-unit assisted living community in Oxford and a 59-unit AL community in Southaven. DHC acquired them in 2006 for a combined $12.4 million, or $112,700 per unit, and at a 7.5% cap rate. The current purchase price is not known, but in DHC’s second quarter earnings report, the company mentioned selling two managed senior living properties and two MOBs subsequent to the quarter for a combined $5.197 million. An undisclosed private equity firm was the... Read More »
Diversified Healthcare Trust Raises Expensive Debt, Ventas Makes Cuts
Diversified Healthcare Trust Raises Debt Diversified Healthcare Trust tapped the debt markets with a $1.0 billion, five-year senior note offering with a yield of 9.75%. That puts the spread over the 5-year Treasury at about 940 basis points. That has to be the widest spread by a healthcare REIT we have seen in years, if not a decade or two. Proceeds will be used to repay a $250 million term loan expiring in June, as well as to pay down certain amounts outstanding under its unsecured revolving credit facility. While the REIT certainly has some credit risk, and it did cut its dividend to just $0.01 per quarter to save $33.3 million each quarter, this still seems to be very expensive... Read More »Schedule a demo
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