Senior Housing Investments & Acquisitions: Aviv REIT, Carlyle Group, NHI

Aviv REIT Acquires Five SNFs for $42 Million

Aviv REIT, Inc. (NYSE: AVIV) announced this week that it has acquired five post-acute and long-term care skilled nursing facilities (SNFs) located in Ohio and Arkansas in two separate transactions for $42.2 million.

Four of the properties are triple-net leased to new Aviv operator Peregrine Health Services and one property is triple-net leased to existing Aviv operator Concepts Management, which is an operator of SNFs with four facilities in Arkansas.

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The sale leaseback transaction with Peregrine stems from a cultivated relationship between the company and Aviv over the past two years. The triple-net lease has an initial cash yield of 9.9%, an initial lease term of 10 years and fixed annual escalators. Peregrine is the operator of SNFs with 16 facilities in Ohio, with over 25 years of experience.

Aviv intends to pursue additional growth opportunities with Peregrine, according to a release from Aviv.

The triple-net lease with Concepts has an initial cash yield of 11%, an initial lease term of 10 years and annual compounded escalators based on CPI. The transaction was sourced by Concepts and brought to Aviv due to the company’s long-term relationships with one another.

Aviv has already had an active fourth quarter, closing over $90 million of acquisitions, said Aviv Chairman and CEO Craig M. Bernfield.

“We still believe that there is a significant and attractive long-term consolidation opportunity with favorable industry dynamics including SNFs being the low-cost provider of long-term and post-acute care,” Bernfield said. “Aviv is committed to investing in post-acute and long-term care SNFs and looks forward to a busy 2014 and beyond.”

Carlyle Group Buys Senior Housing Property from JV

An affiliate of Washington, D.C.-based The Carlyle Group purchased a 128-unit independent living community in New Jersey from a Massachusetts-based joint venture.

The joint venture comprised of affiliates of Equity Resource Investments; Beacon Communities LLC of Boston, Mass. and Lincoln Street Capital LLC of Rockland, Massachusetts.

The property, Regal Pointe, was offered to an affiliate of The Carlyle Group free and clear of existing debt. Equity for the investment will come from Carlyle Realty Partners VI L.P., a $2.25 billion U.S. real estate investment fund.

Regal Pointe, which has been renamed Arbor Terrace at Middletown, features studio and one-bedroom units. The community recently underwent extensive renovations, including an overhaul of residential units, main common areas and the kitchen.

The Carlyle Group intends to convert a portion of the existing units to assisted living and memory care to provide the current and future residents with several levels of care. The Arbor Company has been selected to operate the community going forward. —JO

NHI Commits $17 Million for Two Senior Housing Properties

National Health Investors, Inc. (NYSE: NHI) announced a $17 million commitment for two senior housing properties with its current tenant, Chancellor Health Care.

The commitment includes the $9.5 million acquisition and planned renovation of Woodlands Assisted Living in Baltimore, Maryland, along with a $7.5 million commitment to construct a free-standing assisted living and memory care community on the Linda Valley senior living campus in Loma Linda, California already leased from NHI.

Woodlands Assisted Living is a 63-unit community built in 1999. The initial lease term is for seven years with renewal options at an annual rate of 8% plus annual fixed escalators.

The Linda Valley community will be added to an existing lease between Chancellor and NHI. The current lease term is 15 years with renewal options at an annual rate of 9% plus fixed annual escalators.

NHI purchased the Linda Valley campus in 2012 and leased it to Chancellor Health Care, who has been operating the facility since 1993.

The acquisition was funded from borrowings on NHI’s revolving credit facility. —JO

Florida Assisted Living Facility Sells for $5.7 Million

Re/Max Executive Realty brokers John DeMarco and Gary Smith, of The Smith-DeMarco Group, closed the $5.7 million sale of Midtown Manor, a 105-bed assisted living facility located in Hollywood, Florida.

The property was sold on October 15 and had an occupancy level of 97% at the time of closing.

DeMarco and Smith, who have a long history of healthcare sales and acquisitions, have sold over $50 million worth of commercial property.

DeMarco is a former owner of both home assisted living facilities and home health agencies and is a licensed assisted living facility administrator and licensed home health care administrator.

“The fact that I have been through the change of ownership process with AHCA from an owners standpoint, gives me a major advantage over any other broker attempting to facility a sale,” said DeMarco. “I have personally owned and operated both of these types of businesses myself. This knowledge allows me to truly understand the product I am marketing to investors.” —JO

Ala. Senior Living Community Sells for $3.5 Million

On November 1, Senior Living Investment Brokerage, Inc. facilitated the sale of a 42-unit assisted living and memory care community located in Jacksonville, Alabama for $3.5 million to Legacy Senior Services.

The property, Ladiga Manor, was built in 2009 and offers expansion capability, has maintained a relatively consistent occupancy and revenue over the last twelve months. It was sold by two local owners.

The transaction was handled by Bradley Clousing and Matthew Alley of Senior Living Investment Brokerage, Inc. —JO

Benchmark Acquires Two Senior Living Communities from AEW

Benchmark Senior Living recently acquired two Massachusetts senior living communities from AEW Capital Management through its joint venture with Health Care REIT.

Forge Hill Senior Living, is a 97-unit community in Franklin that has since been renamed to Benchmark Senior Living at Forge Hill. The 79-unit Inn at Robbins Brook in Acton is now called Benchmark Senior Living at Robbins Brook. Both communities were above 90% occupancy at time of sale and mark the company’s 23rd and 24th locations in the state of Massachusetts.

“Benchmark is a well-suited successor to Forge Hill Senior Living and The Inn at Robbins Brook for a number of reasons. These communities have a reputation for providing quality care, a deep-rooted tradition of providing resident-centered services and are located in our New England market.” said Benchmark’s President and COO Stephanie Handelson. “ We are excited about the opportunity to serve seniors and their families in these areas with the Benchmark commitment to excellence.”

Both communities are “great additions” to the Benchmark family, said Jesse Marinko, vice president of acquisitions for the company, and have “natural alignment” geographically speaking. —AG

Written by Jason Oliva

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