First Quarter 2017- Florida Senior Housing Transactions

Are you looking to learn more about the senior housing industry? Are you currently investing in senior housing? Do you need help selling your property? Are you an operator or developer trying to understand a market? I have 13 years experience in senior housing/ healthcare valuation and have toured and or appraised almost every asset in Florida. Let me know how I can help you? ceiliah@ceiliah.com www.Ceiliah.com


TRANSACTIONS:

Bradley Clousing and Jeffrey Binder, sold two properties in Florida that have each traded twice already since 2010. Senior Living Investment Brokerage (SLIB) negotiated $15.5 million or $101,974 per unit sale of two senior housing assets in Hollywood and Pembroke Park, Florida. The Emerald Park and The Plaza at Pembroke Park, two senior living communities in South Florida.  Emerald Park in Hollywood was built in 1998 and features 73 units. The Plaza at Pembroke Park, in Pembroke Park features 79 units and was remodeled in 2012.  The new owner, a partnership between a Florida-based operator and a private investment group, purchased the assisted living/memory care communities from Newcastle Investment Corp.  The communities have already had quite the transaction history. According to our records, the 73-unit Hollywood community, which was built in 1999, sold to TJM Properties in 2010 for $7.85 million, or $107,534 per unit, while the 79-unit community in Pembroke Park was purchased by TJM in 2012 for $4.3 million, or $54,430 per unit. TJM then turned around and sold the communities as part of a 15-property, $200 million deal in 2013 to Newcastle Investment Corp (now New Senior Investment Group). Holiday Retirement operated them, but considered them outliers, prompting the sale. The two properties, which brought in nearly $1 million in EBITDA on $7 million of revenues, are in good physical condition and are geographically well clustered. Occupancy was around 85%, which could be improved.

Countryside Lakes in Port Orange, Florida was acquired by Shepherd Health from Miami, Florida on January 9, 2017 $30,500,000. This property was built in 1984 with 126,000 square feet, this community has 26 independent living and 120 assisted living units. It is fully occupied, with a waiting list, and is 100 percent private pay. A private ownership group is the seller. (source: Healthcare M&A News Volume 22/ Issue 2)

Brad Clousing of Senior Living Investment Brokerage sold a pair of senior living communities, one vacant and one well occupied, in the Southeast. The first location in Ormond Beach, Florida was a 36-unit purpose-built (vacant) memory care community. Despite that, the community was well maintained, and the buyer, citing strong occupancy of the other communities in the area, intends to re-open it. ***I conducted the appraisal on this property***

A Miami Beach -based real estate developer/operator, Shepherd Health, is taking its services to Dayton Beach, Florida with the acquisition of a 146-unit senior living community that comes with a sterling reputation. Built in 1984, the fully occupied (and 100 percent private pay) community has 120 assisted living and 26 independent living units. In 2015, it was one of three Florida AL communities to have received a “Silver- Achievement in Quality” award from the American Health Care Association

Five assisted living communities with a total of 225 units sold on December 8, 2016 for $16,000,000 or $71,111 per unit. The properties were located throughout Central Florida, this assisted living/ memory care community portfolio is owned by a publicly traded REIT and managed by a national operator with a large presence in the state. Occupancy was stable but some facilities were losing money. The buyer was a high net-worth healthcare real estate investor that is partnering with a growing regional operator.  This portfolio was seen as a value-add opportunity for the buyer, since several of the communities were operating at a deficit. Combined, there are 155,000 square feet and the average building age is about 30 years old. Occupancy was in the mid- to high 80s and a significant portion of the census was Medicaid. The public REIT owner had acquired the properties through a large merger a few years before and considered them non-core. Blueprint Healthcare Real Estate Advisors handled the transaction. (source: Healthcare M&A News Volume 22/ Issue 1)

Horizon Bay at Hyde Park sold on December 6, 2016 for $74,000,000 or $544,118 per unit in Tampa, Florida. This property was owned by Bayshore Retirement Living, this independent living/ assisted living community is located on 1.91 acres in Tampa Hyde Park neighborhood. The six-story building was built in 2011 with 153,000 square feet. Occupancy was 98 percent. This property has 136 units, an NOI of $4,000,000 (est. EBITDA). The property is located near two major hospitals and the community is geared towards the high-end market. Amenities include full-service bar and lounge over looking the Hillsborough Bay. The property was renamed Allego at Hyde Park. HFF represented the seller in the transaction, in addition to securing a $48.555 million loan, with a fixed-rate, seven-year term, through Protective Life Insurance Company. (source: Healthcare M&A News Volume 22/ Issue 1)


 

PROPOSED:

Moorings Park at Grey Oaks, is a proposed 75-unit community on 16-acres in Naples located in Southwest Florida. The design and architecture firm Perkins Eastman completed the plans for this (13 unit) independent living, (24 unit) assisted living and (38 unit) memory care community.  The community will have a standalone 6,000-square foot wellness center. This property will be a satellite campus of Moorings Park, another project in Naples also completed by Perkins Eastman in 2014.  Additional partners on the development will include local architecture firm BSSW Architects, general contractor Suffolk Construction and interior designer Wegman Design Group.


 

FINANCING:

Presbyterian Retirement Communities, Inc., or Westminster Communities of Florida, the largest operator of CCRCs in the Florida with nine in the state. They are also the 10th largest not-for-profit operator of senior living units in the county. In Florida they operator2,025 independent living, 468 assisted living and 751 skilled. With the help of HJ Sims they refinanced in order to take advantage of the low interest rate environment.  Founded in 1954, the organization targets the middle income market, with entrance fees ranging from $44,100 to $357,000, and averaging at $120,600. Westminster already worked with HJ Sims in August 2016 to advance refund its 2010A bonds and fund a $45 million capital project, but it also wished to reduce its overall cost of capital/annual debt service, increase its debt capacity so as to borrow new money without affecting its credit rating, and provide improvements to financial covenants. Fulfilling those goals, HJ Sims closed a $160.37 million bond issue with an all-in true interest cost of 4.27% (the outstanding balance of the refunded bonds carried an average interest rate of 5.94%). The refinancing also saves Westminster approximately $9.42 million on a present value basis, with actual aggregate savings of approximately $34.8 million through the life of the prior bonds. Through all of this, Sims maintained the investment grade rating from Fitch of “A-.” (source: The Senior Care Investor, dealmakers forum).

 

 

 

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