Erickson Approved to Acquire Devonshire At PGA National CCRC

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.

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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.

Erickson became the owner in a pre-packaged bankruptcy deal closed after acquiring all of the community’s senior debt, totaling nearly $177 million.

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.

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Written by Elizabeth Ecker