Investors Buy Foreclosed Vegas Senior Housing Portfolio for $150 Million

Interwest Capital Corporation along with Angelo, Gordon & Co. recently purchased a Las Vegas senior housing portfolio out of foreclosure in an approximately $150 million transaction. 

The 2,113-unit Destination Living portfolio includes eight senior communities, among them the 344-unit Destinations at Valley View, the 416-unit Destinations at Pebble, the 271-unit Destinations at Spring Valley, and the 82-unit Destinations at Oakey, which closed in mid-December.

The remaining four properties closed on Thursday, according to Elliott Burrell, senior vice president of acquisitions for Interwest Capital, and the entire portfolio is about 90% occupied. 

Advertisement

CWCapital Asset Management sold the rental portfolio of age-restricted, 55+ communities out of foreclosure on behalf of the bondholders, who took a large loss on their investment, Burrell told SHN. 

Orion Residential of Chicago, financed partially by an affiliate of real estate investor Starwood Capital Group, had spent $243.5 million to acquire what was originally a nine-property portfolio in 2006 from the original developer, Carefree Holdings.

Interwest’s acquisition was split into two parts, each with four properties and approximately 1,000 units, for a total of about $150 million. The oldest community was built in the late 1990s, according to Burrell, who says they’re all relatively new. 

Advertisement

Although the communities were bought out of foreclosure, they weren’t distressed, he adds. “Not a whole lot of capital has gone into them since around 2007, so we have a program to update the clubhouses, do some interior renovation, and keep them up,” he says. 

La Jolla, Calif.-based Interwest Capital is a private equity firm that specializes in the acquisition, operation, and repositioning of commercial real estate, particularly multifamily and hospitality assets. Acquisition partner Angelo, Gordon & Co. is a privately-held New York-based investment adviser that specializes in alternative investing and has approximately $25 billion under management. The terms of the joint venture have not been disclosed. 

CompassRock Real Estate will run the day-to-day operations of the four communities, which will remain age-restricted while undergoing capital improvements to keep them competitive with the market, Interwest said. 

Recommended SHN+ Exclusives

Written by Alyssa Gerace

Companies featured in this article:

, , , ,