Erickson Living has been approved to acquire the Devonshire at PGA National, a troubled continuing care retirement community that last year defaulted on nearly $160 million in debt following a period of economic distress and falling home values in its home state of Florida. The transaction is expected to close December 31.
The 493-unit CCRC is located in Palm Beach Gardens, Florida, and has undergone a reorganization plan advised by Cain Brothers that makes Erickson the new community owner. The restructuring plan was approved in a bankruptcy hearing earlier this month.
Cain brothers advised both on the acquisition of $158.4 million in senior debt formerly held by four institutions and the mezzanine lender on the sale of its loan collateral.
In April 2012, the community defaulted on its debt, after which Erickson, through an affiliate, became the sole owners of Senior Notes A, B and C. Following the default, H.J Sims foreclosed on the loan, making it the technical owner of the holdings company that owned the Devonshire property.
Through the transaction, Erickson, one of the nation’s largest CCRC operators, will add the Devonshire’s three four-story residential towers to its portfolio comprising 327 independent living units as well as two-story health centers including 22 assisted living units, 20 memory care units and 76 skilled nursing beds.
Written by Elizabeth Ecker