The Dealmakers Forum E-Newsletter, December 18, 2013 - Recommendations On A Seniors Housing Bubble, REIT, Market and Senior Housing and Care Stocks Down, Merger and Acquisition Transactions

 

Bringing You Senior Care M&A Deals and News
 

December 18, 2013 Issue:

 

Seniors Housing Weekly Update: 60 Seconds with Steve Monroe
Recommendations On A Seniors Housing Bubble. Viewers responded to last week's post about a looming seniors housing bubble. Read More

 

Recent Senior Care M&A Deals

Long-Term Care

 

 

Acquirer

Target

Price

HealthLease Properties REIT

Wellbrooke of Crawfordsville

$16.98 million

Aviv REIT, Inc.

LTC campus and specialty hospital

$44.9 million

 

Deal of the Week

The key word for health care REITs these days is diversification, whether it is from tenants with too high a concentration or property types. Aviv REIT, which went public earlier in 2013, was predominantly a skilled nursing REIT with investments across a few dozen mostly private operators. The company has been expanding in the assisted living market, but it recently announced two acquisitions that diversify it even further, but not without some new risk. It purchased a campus in Ohio that includes an assisted living facility, a skilled nursing facility and a long-term acute care hospital (LTAC), plus the right to build another LTAC. The ALF is leased to one operator at an initial cash yield of 8.0%, while the SNF and LTAC are leased to a second operator at an initial cash yield of 9.8%. Aviv also purchased a specialty hospital in Indiana which is leased to a third operator with an initial yield of 10.0%. All in all, attractive yields providing tenant and property diversification..... Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

Stock of the Week

With much if the market down in the past week, and almost all seniors housing and care stocks down since December 1, there has been one, and just one, standout, and that is Kindred Healthcare. Since the end of November, Kindred’s shares have jumped by 15% and are now up nearly 80% for the year, topping the stellar performance of The Ensign Group, which is now up 63% for the year. There has been no major news coming out of Kindred, and the reimbursement picture isn’t what we would call rosy. Perhaps investors are finally realizing that Kindred is, in fact, prepared for the future of health care delivery, whatever that may entail, and are rewarding it for being forward thinking and making some hard decisions on properties and strategic direction. About time......Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

Stat of the Week

Last year, there were 185 what we call “publicly announced” merger and acquisition transactions in the seniors housing and care market. It may be hard to believe, but that was a record according to our stats. So far this year, we have topped 205 announced transactions, and by the end of December there is a good possibility we will hit 220, which would be a nearly 20% increase over 2012. What has been driving this activity? Obviously a very hot market amid very successfully operated senior living communities and skilled nursing facilities. But there has also been an increase in REIT activity, and most of them involving the smaller REITs and non-traded REITs. Of the 205 deals so far this year, about one-third have involved REITs as the buyers. And who said the Big Three was going to dominate the market?......Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

 

NEW - The Senior Care Acquisition Report, 19th Edition - Preorder Today!
Deals have been made. The 2014 Senior Care Acquisition Report contains private deals in this market that are frequently too small to make into financial press. Take advantage of our limited 2-for-1 offer - Preorder The 2014 Senior Care Acquisition Report by December 31st and receive The 2013 Senior Care Acquisition Report FREE ($595 value)! Now that’s a deal! Go to http://www.levinassociates.com/scardescription or call 800-248-1668 to preorder today.

 

Upcoming Interactive Webcast:
Build or Join an ACO—Don’t Let The Opportunity Pass You By!
Thursday, January 23, 2014, 1:00 pm ET            
A year ago, the Affordable Care Act directed doctors, hospitals, and other health-care providers—including long-term-care facilities—to coordinate care provided to Medicare patients through Accountable Care Organizations (ACOs). Timing can be tricky—urgent for post-acute care providers—and appropriate contracts are crucial. Go to http://www.levinassociates.com/conferences/1401-online-conference or call 800-248-1668 to register.

 

 

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