Senior Housing Investment & Acquisition Round-Up (4/9/13)

MBK Senior Living Sells Two Properties to Brookdale for $56.1 MIllion  

Brookdale Senior Living recently purchased two Spokane, Washington properties from MBK Senior Living for $56.1 million. 

The properties, built between 1999 and 2003, include a combination of assisted living and memory care units, with an additional 20 independent units in one of the communities. Combined occupancy of the properties is roughly 92%. 

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CBRE represented MBK in the transaction. Terms of the deal have not been disclosed. 

JV Buys Calif. Senior Housing Complex for $10.5 Million 

Preservation Partners and Clifford Beers Housing recently purchased a 90-unit affordable senior housing complex in Wilmington, Calif. for $10.5 million, represented in the transaction by Tim Steuernol with NAI Capital’s West L.A. office.

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The seller is VPP Banning Villas Apartments VP, represented by Kanna and Ramu Sunkara of Sunkara investments.

The property was built in 1976 and has 90 one-bedroom units with wood frame and stucco construction. Property amenities include a large courtyard, a clubhouse, and carports for each unit. 

There are also plans in the works to completely renovate the complex with a new roof, kitchens, bathrooms, and appliances throughout. 

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“We are pleased to have been able to preserve this asset as senior housing for the next 55 years with the help of Clifford Beers and Enterprise,” Jon LaLanne, partner with Preservation Partners, said in a statement. “The commitment we received from HUD will allow us to do approximately $50,000 per unit in capital improvements.”

The buyers used a $9.4 million Golden State Acquisition Fund (GSAF) loan originated by Enterprise Community Loan Fund to purchase and rehabilitate Banning Villa Apartments. The loan allows the property to remain affordable to low-income seniors for an additional 20 years.

Senior Solutions Management Group Adds 2 ALFs to Portfolio 

Senior Solutions Management Group announced on April 4 a partnership with Elder Hope Investments in which it will take over operations for two of Elder Hope’s licensed assisted living communities in the Atlanta, Ga. market.

The Hope Memory Care Centers in Dacula and Fayetteville, GA. represent SSMG’s first communities in the greater Atlanta area.

“Senior Solutions Management Group is proud to partner with Elder Hope Investments to manage their Memory Care Centers located in Dacula and Fayettville, Georgia,” said Todd Barker, Chief Operations Officer for Senior Solutions Management Group, in a statement. “With their expertise in development and our unique management approach, we are confident we will deliver a new model of memory care services that others will follow.”

Each community has 64 units which will be divided into four smaller “villages,” says SSMG, with each village representing the various stages of Alzheimer’s disease and the unique care that each stage of the dementia requires. 

SSMG will use electronic medical records and electronic care plans in the Hope Memory Care Communities, as it does in the other communities it manages.

The Dacula community just recently received its Assisted Living license, making it the seventh senior living community in Georgia to obtain the new, more comprehensive licensure. The Fayetteville location is currently under construction and will have the new licensure when it opens its doors to the public in mid- to late summer. 

SSMG now has 12 communities, some in operation and others in various phases of development, in the state of Georgia. 

SMA & ValStone Partners Acquire Fla. Community for $2 Million

Senior Management Advisors, Inc. (SMA) and ValStone Partners, LLC recently acquired the Palazzo Di Oro, a former assisted living facility that closed in 2011, for $2 million. The joint venture partnership plans to renovate the property and reopen it as Grand Villa of St. Petersburg, a memory care and assisted living community.

“This is a wonderful property that should receive an extremely positive reception from local residents after renovation is completed in late 2014,” said Steven Piazza, president, Senior Management Advisors, in a statement. “We will be investing a significant amount into renovation and improvements of the interior and exterior and look forward to serving local residents in keeping with our commitment to top quality services offered in a homelike atmosphere.”

This marks the eleventh property in the SMA and ValStone venture in which the two organizations have collaborated on the purchase, renovation, rebranding, and management of senior living communities. 

Along with the $2 million price tag, SMA and ValStone are anticipating multi-million dollar renovations, expected to take 18 month, after which Grand Villa of St. Petersburg will reopen with approximately 150 units. Of those, 30 units will be dedicated for memory care. 

Renovations will include remodeling of the first floor to include an Internet cafe, library, billiards parlor, beauty salon, barber shop, and private dining room, with common areas including lounges and activity rooms. Resident rooms will also be remodeled to include kitchenettes with built-in refrigerators and microwaves, spacious closets, and large private baths. Emergency alert call systems will also be provided in all bedrooms and bathrooms.

Exterior renovations will include landscaping, and updating the entrance and parking lot. 

Bradley Clousing of Senior Living Investment Brokerage facilitated the transaction. Jordan Behar of Behar + Peteranecz: Architecture is the project architect. 

The former Palazzo Di Oro was built as a hotel in 1971 and underwent a renovation in the 1990s, when it was converted to an assisted living community. additional improvements were made in 2005, but in 2011 the property was foreclosed on by the syndicate of lenders.

SMA and ValStone have previously collaborated on other hotel-to-senior living redesigns, most recently the Tides Hotel in Melbourne, Fla., which reopened in 2011 as Grand Villa of Melbourne. 

New Mexico Senior Care Community Sells for $3.5 Million

Senior Living Investment Brokerage, Inc. facilitated the sale of an assisted living and memory care community in Hobbs, New Mexico for $3.53 million to a regional owner/operator based in the East Coast.

The 69-unit senior care community was originally constructed in 1964 as a hotel, then was converted in 1990 into senior housing. It underwent renovations in 2002 and 2010.

The one- and three-story building is approximately 63,500 square feet and is located on 2.4 acres. The property has a “strong operating history” according to Senior Living Investment Brokerage, with occupancy near 87% at time of sale. 

The seller is a national owner/operator based in Oregon who divested the asset to utilize the capital for other corporate purposes. 

Jeff Binder, Matthew Alley, and Toby Siefert of Senior Living Investment Brokerage handled the transaction. 

NorthStar Healthcare Makes Initial $2 Million Senior Living Investment

NorthStar Healthcare Income, Inc. announced recently it had made its initial investment by purchasing a $2 million pari passu participation interest in an $11.25 million senior loan from an affiliate of the sponsor, NorthStar Realty Finance Corp. (NYSE:NRF).

The loan and participating both bear interest at 7.0% throughout the one-month LIBOR index with a minimum interest rate of 8.0% per year.

The sponsor recently originated the loan and sold the participation to NorthStar Healthcare at its cost basis. NorthStar Healthcare will purchase additional amounts of the loan from time to time as additional capital is raised, thereby increasing the size of its participating until it owns the whole loan.

A 112-unit independent living, assisted living, and memory care community secures the loan. The community is managed by an “experienced” operator and located in Madera, Calif.

“We are very pleased to announce our initial investment in an asset that is consistent with our targeted investment portfolio and our sponsor continues to generate an attractive pipeline of additional investments that will allow us to quickly invest the company’s capital as it is raised,” said Daniel Gilbert, CEO of NorthStar Healthcare, in a statement. 

Emeritus Sells Assisted Living Community to Montana Investors

Emeritus Corporation (NYSE:ESC) recently sold an assisted living community in Butte, Montana to a group of local investors, reports The Montana Standard.

Big Sky Senior Living, which opened in 1998, will return to its former name, the Waterford, and be operated by Health Management Services. 

The 161-unit community has 149 apartments and 12 independent living cottages, and has about 100 residents. The new management company’s first goal is to increase occupancy, the Standard reports. 

Other plans include general upgrades for flooring, windows, lighting, and more, along with the addition of a memory care unit by converting an existing wing into an approximately 20-unit secured ward.

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