The Dealmakers Forum E-Newsletter, June 18, 2014 - Newcastle's New REIT, Rick Grimes of ALFA Announces Retirement, and more...

 

Bringing You Senior Care M&A Deals and News
 

June 18, 2014 Issue:

Seniors Housing Weekly Update: 60 Seconds with Steve Monroe
Kindred Healthcare Increases Gentiva Health Bid. Kindred is taking its offer to buy Gentiva Health Services directly to Gentiva shareholders with a slightly higher bid of $14.50 per share............. Read More   

 

Recent Senior Care M&A Deals
Long-Term Care
   
Acquirer
Target
Price
N/A
New York Investment Group
$10 million                              


Deal of the Week

The Freshwater Group and Health Care REIT closed on the acquisition of two senior living communities in California. Located across the Bay just east of San Francisco, one community was built in 2010 with 126 assisted living and memory care units. The assisted living units are 100% occupied while the memory care is just 56%, which is very unusual and represents significant opportunity. The other community, which is nine miles away, was built in 2002 with 56 memory care units and is 97% occupied. That higher occupancy must be providing some confidence that the buyer and its operating company, Watermark Retirement Communities, will be able to fill the other property’s memory care units. The purchase price was $80.5 million, or $442,300 per unit and $334,000 per bed. This is, after all, coastal California. The cash flow and occupancy has been steadily increasing during the past six months, and assuming it continues to increase with improved occupancy, first year cash flow should be about $5.5 million. After that, it will be all about margin increases, and the buyer is expecting an eight percentage point increase by year two. Carl Mittendorff of The Freshwater Group worked the transaction and brought it to Health Care REIT, which will lease it back to them............... Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

Newcastle Investment Corp. Spin-off 

Newcastle Investment has announced that it will be spinning out its seniors housing real estate assets into a new REIT to be called New Senior Investment Group with a proposed listing on the New York Stock Exchange with the ticker symbol “SNR.” This does not come as a surprise, and will be the third spin-out of a separate business since late 2011. We assume management has now figured out what Newcastle wants to be when it grows up. With about $1.6 billion in assets, the seniors housing portfolio represents the lion’s share of value within Newcastle, and they have a $300 million current acquisition pipeline and another $650 million or more that is looming. The new REIT will still be small, and will still be managed by The Fortress Group, but the spin-off makes a lot of sense. Somehow, seniors housing and golf courses didn’t seem to go together from an investment perspective, other than some of the demographic characteristics. The net equity of the seniors housing business is just over $500 million, so this will be a very small publicly traded REIT, but they do have grand plans to grow. Until, that is, Fortress decides it is time to cash in and sell. .................Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

Rick Grimes Set to Retire from ALFA 

After serving 10 years at the helm of ALFA, Rick Grimes has announced he plans to retire and that the Board will start a search for his replacement. He arrived at ALFA during a difficult period, both financially and operationally, and he is leaving the organization in much better shape with reserves in excess of $1.0 million and its annual conference last month that was reported to be the largest in its history. Simultaneously with the retirement news, ALFA announced that it is taking several actions, including increasing the size of its Board, changing the dues structure to three flat rates (no longer based on size of company), a re-branding initiative, the establishment of a new state policy committee and other initiatives. Many of these initiatives came out of the One Voice initiative to merge ALFA with ASHA which did not occur...............Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today

 

Expert Opinion: A Conversation with Yaroslav Faybishenko

In this "Expert Opinion" interview, Yaroslav Faybishanko, CEO, Pixie Scientific, discusses medical devices, incontinence, manufacturing, clinical data, and more..........Watch the video

 

Sponsored Content:

SNF Portfolio Sale - Chapter 11 Bankruptcy Auction July 28, 2014 
18 Prime Skilled Nursing Facilities are for sale in California. Don't miss this opportunity to purchase 1,905 beds in one acquisition. Click here for more information.

 

The Senior Care Acquisition Report, 19th Edition - Catch the Competition!
Deals have been made. The 2014 Senior Care Acquisition Report contains private deals in this market that are frequently too small to make it into the financial press. Order by June 30th and you will recieve a complimentary $150 worth of deals in our online senior care m&a databse. Now that’s a deal! Go to http://www.levinassociates.com/landing/scar19order or call 800-248-1668 to order today.

 

Around the Web in Senior Care M&A...Click here to see more

Webcast Calendar... Click here to see more

Upcoming Conference Partnerships... Click here to see more

Previous Issues of The Dealmakers Forum... Click here to see more