Senior Housing Investments & Transactions: Mainstreet Acquires $44.3 Million Memory Care Portfolio

Mainstreet Acquires Three Memory Care Communities for $44.3 Million

Mainstreet Health Investments Inc. (TSX: HLP-U) entered into an agreement to acquire a portfolio of three memory care communities, totaling 171 units, for the purchase price of $44.3 million, representing a year one capitalization rate of 7.85%. .

The communities are located in Little Rock, Arkansas, and New Braunfels, Texas, and San Antonio, Texas. All three memory care communities are newly developed within the last two years by the Embree Group, a national developer of health care and senior living facilities. One-hundred percent of revenue is expected to be derived from private pay funding sources.


Mainstreet will lease the communities to Memory Care of America, LLC (MCA), a Nashville-based memory care operator with a regional presence in the southern United States. Mainstreet and MCA will enter into a 15-year initial term absolute net master lease agreement, with three five-year extension options.

The deal also comes with additional investment opportunities for Mainstreet, including the first right to fund the next three senior housing projects developed by Embree and operated by MCA. The first such investment is expected to break ground in the first half of 2017.

In connection with the acquisition, the company also announced it entered into an agreement with a syndicate of underwriters led by National Bank Financial Inc., BMO Capital Markets and CIBC Capital Markets to sell $45 million aggregate principal amount of 5% convertible unsecured subordinated debentures, which will be convertible at the option of the holder into common shares, at $11 per common share.

The acquisition will be financed through a bought deal offering of convertible debentures.

Ensign Group Completes Sale of Urgent Care Assets

The Ensign Group, Inc. (NASDAQ: ENSG), the parent company of the Ensign group of skilled nursing, rehabilitative services, hospice care and assisted living companies, completed the previously-announced sale of its urgent care assets. The sale includes all 14 urgent care operations in the greater Seattle market.

The buyer is MultiCare Health System, a not-for-profit health care organization with a comprehensive network including 15 urgent care centers in the Puget Sound region, as well as 11 RediClinics located inside select Rite Aid stores. The company has also added Immediate Clinic as part of its urgent care growth strategy.

The sale was effective Dec. 11. The sale of Immediate Clinic, together with the sale of Integrity Urgent Care in Colorado earlier this year, represents all of the Ensign-affiliated urgent care operations, according to Ensign.

GreatCall Acquires Healthsense

San Diego-based connected health company GreatCall has acquired Healthsense, a Minnesota-based provider of remote monitoring services for senior living communities and other health care providers. The acquisition greatly expands GreatCall’s portfolio of connected health services.

“As GreatCall continues to expand in these key markets, Healthsense is a natural fit – with our missions of increasing independence, reducing total cost of care and improving the resident, family and caregiver experience,” David Inns, CEO of GreatCall, said in a statement. “Acquiring Healthsense brings important capabilities in predictive analytics that dovetail with our deep customer knowledge, expands our offering, as well as increases our exposure in senior living and health care.”

Healthsense uses passive remote monitoring with wireless sensors to monitor everyday activities of daily living, such as eating, sleeping and movement. It gathers information to establish patterns, evaluate data and enable caregivers to act proactively when they spot changes indicative of early onset of a negative health event.

Griffin-American Healthcare REIT IV Acquires Senior Housing Portfolio in Lafayette, Louisiana 

American Healthcare Investors (AHI) and Griffin Capital Corporation, the co-sponsors of Griffin-American Healthcare REIT IV, Inc., have acquired a 107-unit assisted living portfolio in Lafayette, Louisiana.

The portfolio includes two buildings of Lafayette Assisted Living Portfolio, which were built in 1997 and 2015. Of the 107 licensed beds, 37 are dedicated to memory care residents. The portfolio is 100% private pay and currently operated by Colonial Oaks Senior Living, LLC.

Colonial Oaks was founded in 1977 and operates nine senior housing facilities located in Texas, Georgia and Louisiana.

The REIT purchased the portfolio from Hannie Development, Inc. and Cedar Crest, LLC, both of which are unaffiliated third parties represented by Sean McNee of Cushman & Wakefield, Inc.

The REIT financed the acquisition using cash proceeds from its initial public offering and borrowings under its line of credit with Bank of America, N.A. and KeyBank, National Association.

Blueprint Sells Memory Care Facility in Virginia

Blueprint Healthcare Real Estate Advisors sold a 45-unit memory care community located in Woodstock, Virginia. The purchase price was not disclosed.

The property, Royal Haven at Woodstock, was vacant at the time of sale, as ownership elected to invest in property upgrades and site improvements to the community.

The buyer is a regional operator with a focus on providing memory care and assisted living in Virginia.

Steve Thomes and Tim Cobb of Blueprint were advisor on the transaction.

Community Preservation Partners Acquires California Senior Housing Community

Community Preservation Partners (CPP) has acquired its largest affordable housing development, located in Cathedral City, California. The transaction is approximately a $42 million deal for CPP, which is based in Irving, California, and owns more than 4,500 units across the country.

The senior housing apartments complex boasts 280 units, and the deal is believed to be the largest single-site U.S. Department of Agriculture (USDA) rural housing transaction, Housing Finance reported.

CPP purchased the community from a private trust. The property will maintain affordability for residents and allow for needed improvement, according to Housing Finance. The community consists of 70 four-unit residential buildings over 20 acres. The one-bedroom apartments are reserved for low-income seniors. Rents will remain below market value for 55 years.

The transaction was financed in part with $16 million from the USDA Sec. 538 loan guarantee program and an approximately $9 million USDA Sec. 515 rural rental housing loan, Housing Finance reported.

CPP will invest approximately $11.3 million, or $40,000 per unit, to rehabilitate the community. Plans include replacing all windows and doors, making water-efficient upgrades, installing energy-efficient appliances and remodeling bathrooms. Two community spaces will also be upgraded.

SunTrust Closes Acquisition of Pillar Financial

SunTrust Bank has closed on its acquisition of Pillar Financial and its assets, including Pillar’s multifamily lending business, which consists of multifamily, affordable housing, health care properties, senior housing and manufactured housing specialty teams, Housing Finance reported.

The transaction includes Chicago-based Cohen Financial’s commercial real estate investor services business, offering loan administration and advisory services, and its mortgage brokerage business.

Pillar Financial and Cohen Financial will operate within SunTrust Bank as a component of its commercial real estate (CRE) line of business, part of SunTrust’s wholesale banking segment, according to Housing Finance.

Pillar Financial’s CEO and Senior Managing Director Anand Gajjar now reports directly to Kathy Farrell, SunTrust CRE executive, as head of the Pillar Division. The leadership teams from Pillar and Cohen have also joined SunTrust.

Robinson Humphrey served as financial advisor to SunTrust for the transaction. Beckman Advisors acted as strategic advisor for Pillar.

PGIM Real Estate and Allegro Senior Living Acquire Senior Living Community in Florida

PGIM Real Estate and Allegro Senior Living, serving as co-owners, have formed a joint venture to acquire a senior living community in Hyde Park, Florida. PGIM Real Estate is the real estate investment buisness of PGIM, Inc., the global investment management businesses of Prudential Financial, Inc. (NYSE: PRU). Allegro Senior Living specializes in senior living ownership and management with roots dating back to 1875.

The community, formerly known as Horizon Bay at Hyde Park, consists of 136 independent living and assisted living units. The community has been rebranded as Allegro at Hyde Park. Allegro will act as operator of the community.

The on-site team will remain in place, and there are no major changes or renovations planned for the community.

“The Hyde Park community fits in seamlessly with our portfolio of managed properties,” Douglas Schiffer, president and COO of Allegro Senior Living, said in a statement. “We are very happy to welcome this team of associates who already live the Allegro values that make us successful.”

Allegro currently operates 11 communities throughout Florida and Kentucky, with a home office in St. Louis, Missouri.

Written by Amy Baxter

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