Virtus Real Estate Capital and American House Senior Living recently announced the acquisition of Sterling Woods, an independent living community in a Detroit suburb, for $7.65 million at a trailing 12-month cap rate of 8.5%.
The property, known as American House Sterling Woods, is a 78-unit community consisting entirely of one- and two-bedroom apartments. The acquisition, which became effective on April 30, was 91% occupied at time of sale.
Located in the metro Detroit suburb of Sterling Heights, Sterling Woods was built in 2006 and is equipped with a full-service kitchen, café and theater room.
The acquisition of Sterling Woods now brings the total number of communities operated by American House to 32 in the state of Michigan. It also marks the company’s second joint venture with Virtus Real Estate Capital.
In December 2012, the two companies closed on Park Place at Heritage Village in Warren, Mich. for $20.8 million.
“We are pleased to expand our partnership with American House and source off-market strategic acquisitions to help grow their operating platform,” said Aaron D’Costa, director of senior living acquisitions for Virtus Real Estate Capital. ”Their formidable presence in the Detroit suburbs combined with NICMAP data rankings for independent living occupancy and rent growth give us confidence that this acquisition will continue to perform well.”
In accordance with other American House locations, Sterling Woods plans to offer amenities such as full life enrichment and wellness programs, culinary options, housekeeping, transportation and third-party personal care services.
“Virtus’ expertise of the real estate market, coupled with American House’s knowledge of the senior housing industry, has lent itself to a meaningful partnership thus far,” said Rob Gillette, chief operating officer of American House. “We’ve been able to explore the strategic growth of our business and we’re looking forward to new opportunities for expansion and to serve the community with high quality senior housing.”
Written by Jason Oliva