Senior Housing Investments & Transactions: NHI, CareTrust REIT

The Ensign Group Makes Moves Nationwide

In separate announcements, The Ensign Group, Inc. (NASDAQ:ENSG) — the parent company of the Ensign group of skilled nursing, rehabilitative care services, home health care, hospice care, assisted living and urgent care companies — acquired 10 skilled nursing and assisted living operations in Arizona, the operations and real estate of a skilled nursing facility in Washington, and a skilled nursing facility and hospice agency in California.

Arizona — The Ensign Group, Inc. has agreed to purchase 10 skilled nursing and assisted living operations in Arizona.

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The acquisition includes: Granite Creek Health and Rehabilitation Center (Prescott); Citadel Post Acute (Mesa); Heritage Court Post Acute of Scottsdale (Scottsdale); Lake Pleasant Post Acute Rehabilitation Center (Peoria), South Mountain Post Acute (Phoenix); La Canada Care Center (Tucson); Mountain View Care Center (Tucson); The Citadel Retirement Community (Mesa); Las Fuentes Resort Village (Prescott); and Mountain View Retirement Village (Tucson).

Ensign’s operating subsidiaries entered into a new long-term master lease beginning July 1, 2015.

Washington — In a separate transaction on the same day, an Ensign subsidiary also acquired the operations and real estate of Olympia Transitional Care and Rehabilitation, a 125-bed skilled nursing facility in Olympia, Wash. The Washington purchase was effective July 1, 2015 and Ensign will retain ownership of the real estate for the facility.

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California — The Ensign Group also acquired The Orchard Post-Acute Care Center, a 162-bed skilled nursing facility in Whittier, Calif. An Ensign subsidiary has been operating the facility since January 2006 under a sublease arrangement with the ground lessee. The underlying ground lease has a remaining term of 20 years. The acquisition was effective June 29, 2015.

In a separate transaction, The Ensign Group announced that Cornerstone Healthcare, Inc., Ensign’s home health and hospice portfolio subsidiary, had acquired Buena Vista Hospice, a Medicare and Medi-Cal certified hospice agency serving the Ventura County area from an office in Westlake Village, Calif. The acquisition was effective July 1, 2015.

With the acquisition, Cornerstone now owns 14 hospice operations, 14 home health operations and three home care operations in nine western states.

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The Ensign Group’s independent operating subsidiaries provide a range of skilled nursing and assisted living services, physical, occupational and speech therapies, home health and hospice services, urgent care services and other rehabilitative and healthcare services at 161 facilities, 14 hospice companies, 14 home health businesses, three home care businesses, and 17 urgent care clinics.

NHI Acquires 3 Senior Living Campuses for $67 Million

National Health Investors, Inc. (NYSE: NHI) announced recently a $67 million purchase of three senior living communities in North Carolina, Indiana and Tennessee in a sale-leaseback transaction with affiliates of East Lake Capital Management.

The 413-unit private pay portfolio is 86% occupied and comprised of 205 independent living, 137 assisted living and 71 memory care units. The purchase was funded with borrowings on NHI’s revolving credit facility.

“This acquisition of high-quality senior living communities is representative of NHI’s relationship-oriented approach of partnering with experienced operators,” said Justin Hutchens, NHI’s CEO and president, in a statement.

They will be operated by New Horizons Senior Living, an affiliate of East Lake Capital Management, and will have a 10-year lease with renewal options at a lease rate of 7% plus fixed annual escalators.

CareTrust REIT Enters Florida With Senior Housing Acquisition

CareTrust REIT, Inc. (Nasdaq: CTRE) recently announced that it has acquired Bristol Court Assisted Living, a 70-unit/115-bed memory care facility located in St. Petersburg, Fla., for $8.4 million. With the acquisition, CareTrust entered into a master lease with Better Senior Living Consulting, LLC, which took over operations effective July 1, 2015.

The acquisition has a going-in cash yield of 8.5% on EBITDAR rent coverage of 1.24x, producing initial annual rental revenue of $716,022. The master lease has an initial term of 15 years with two five-year extensions and CPI-based rent escalators. The investment is CareTrust’s ninth announced transaction and fifth senior housing acquisition.

CareTrust also announced that it has acquired Shamrock Nursing and Rehabilitation Center, a 105-bed skilled nursing facility in Dublin, Ga., for $8.3 million in a separate transaction. Concurrently with the acquisition, CareTrust entered into a master lease with Trillium Healthcare Group, LLC, which took over operations effective July 1, 2015.

High Road Capital Partners Acquires Ariad Communications

High Road Capital Partners announced recently that it has acquired Toronto-based Ariad Communications, which it will combine with its platform company Bluespire Marketing.

Ariad is a strategic marketing agency specializing in serving Canadian clients with content, digital marketing and consumer activation capabilities. Bluespire is a provider of strategic, multi-channel marketing solutions with an emphasis on end-user content and digital marketing for health care, financial services and senior living companies.

Each business will continue to operate its brands, but Mike Beckerman, a 20-year marketing veteran and president of Ariad, will serve as CEO of the combined company.

The transaction closed June 30, 2015.

Evans Senior Investments Kicks Off July With 2 Sales

Evans Senior Investments has facilitated the sale of a senior living campus in Washington and a community in Ohio for $18 million and $11.2 million, respectively.

Washington — Located on the same campus in Vancouver, Wash., Fort Vancouver Convalescent Center (skilled nursing facility), Caretique (memory care), and Park Lido (assisted living facility) sold for $18 million, or $132,352 per unit.

Fort Vancouver Convalescent Center features 67 functional skilled nursing beds (92 Licensed Beds); Caretique features 24 memory care beds; and Park Lido features 45 assisted living units for a total of 136 beds.

At the time of the transaction, occupancy ran between 70% and 80% for the facilities.

In a competitive bidding process, a publicly traded REIT emerged as the buyer. A regional operator will step in to operate and manage the facility.

Ohio — Glenwood Retirement Community, a hospital-owned entrance fee assisted living and independent living community in Ohio, sold for $11.2 million, or $91,423 per unit.

The buyer, a faith based nonprofit, assumed $6.8 million in entrance fee liabilities for a net purchase price of $4.4 million.

Built in 1997, the 122-unit facility represented the chance to own a cash-flow positive Class A rental community and was marketed in conjunction with Harmar Place Skilled Nursing Facility (not represented by ESI).

Both facilities are owned by the Marietta Memorial Health System, an Ohio based hospital system.

At 150,000 total square feet, the facility includes 48 assisted living units, nine independent living villas, 60 independent living units and five independent living units used for guests. Total combined occupancy is 88% with revenue of $3.9 million. The final cap rate of the facility was 9.3% on the trailing twelve months NOI of $1.05 million.

National HealthCare Corporation to Deploy LG CNS Solutions 

Collain Healthcare, an LG CNS company, and National HealthCare Corporation have announced the deployment of LG CNS’ Electronic Health Record (EHR) solution for the company’s skilled nursing operations.

LG CNS is also collaborating with National HealthCare (NHC) for the deployment of an integrated EHR for its home care operations. LG CNS Population Health Cloud will also be implemented to improve coordination of care, streamline care transitions with referring partners, as well as contribute to goals for population health management across regional markets.

Telemedicine, Electronic Health Records, and the Point of Care Solution (POCS) smart mobile platform from LG CNS will be deployed across service lines. The LG CNS Population Health Cloud will unify the following in a single system: a longitudinal patient record repository, Health Information Exchange (HIE), call center integration, case management, alerts/notifications, nurse triage, telemedicine, claims integration, analytics and more.

Written by Emily Study

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