The Dealmakers Forum E-Newsletter, July 9, 2014 – Center Management Group Buys Seven Senior Care Properties From The Archdiocese of Philadelphia, CBRE Senior Housing Services Group Places $38 Million Fannie Mae Mortgage

 

Bringing You Senior Care M&A Deals and News
 

July 9, 2014 Issue:
Seniors Housing Weekly Update: 60 Seconds with Steve Monroe
Will Kindred Up Its Price For Gentiva Health? After being rebuffed at every turn, Kindred will either be forced to increase its bid or walk away…………… Read More   
 

Recent Senior Care M&A Deals

Long-Term Care

 

 

Acquirer

Target

Price

Capital Senior Living Corporation

3 senior living communities

$83.6 million

Newcastle Investment Corp.

6 rental CCRCs

$186 million

Aviv REIT, Inc.

3 skilled nursing facilities

$16.2 million

American Realty Capital

Healthcare Trust

4 assisted living communities

$80 million

Texas Operator

Texas skilled nursing facility

$2.9 million

Center Management Group

7 senior care properties

$145 million                              

Deal of the Week
The Archdiocese of Philadelphia announced it entered into an agreement to sell seven properties to Center Management Group, a New York-based operator of nursing facilities in New Jersey and New York. The purchase price is approximately $145 million, or $101,750 per bed/unit. The portfolio, all in Philadelphia and the surrounding area, includes five skilled nursing facilities, one CCRC and one independent and assisted living community with a total of approximately 1,215 nursing beds, 150 IL units and 60 AL units. Approximate 2013 revenues and adjusted EBITDA were $138.0 million and $3.9 million, respectively, but we assume the buyer has big plans to increase the cash flow. This is a huge deal for Center Management, since it will increase its portfolio by 50%. KPMG represented the seller in the transaction, which is expected to close by the end of the year. ……….. Want to read more news? Click here for a free trial to The SeniorCare Investor and download the current issue today
 
Financing of the Week 
Matthew Whitlock of the CBRE Senior Housing Services group closed on a $38 million first mortgage financing with Fannie Mae. The new loan, secured by a 265-unit retirement community in Rhode Island with independent living, assisted living, memory care and private pay skilled nursing units, refinanced and consolidated the community’s first and supplemental financings, both of which were through Fannie Mae. The seven-year loan has a 30-year amortization, and the fixed interest rate is 4.36%, or about 220 basis points over the seven-year Treasury. That is a very attractive rate, and although this was a refinancing and not an acquisition loan, it is one of the reasons why the acquisition market is so hot with prices going up and cap rates getting more aggressive with buyers returning to paying a multiple on first or second year cash flow, as opposed to trailing 12 months cash flow………..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 
Speaking of cap rates and prices, in the seniors housing market in 2013 (assisted and independent living combined), those sales that came with a cap rate of 7.5% or lower were at an average price of $217,600 per unit. There was a big drop in the average price for those sales with cap rates between 7.5% and 8.5%, declining to $149,700 per unit. It wasn’t until the average cap rate was 10.5% or higher that there was the next significant drop in value, and for these sales the average price was just $82,000 per unit………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 David Glickman and Iggy Fanlo, Co-Founders, Lively Inc.
In this “Expert Opinion” interview, David Glickman and Iggy Fanlo, Co-Founders, Lively Inc., discuss monitoring systems, independent living, mobile technology, pricing, and more…….Watch the video
 
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 2014 Home Health and Hospice Acquisition Report 2 for 1 Special – Preorder Today!
There’s no quicker way to get current on the home health and hospice M&A market or review historic M&A data. Learn all about today’s home health merger and acquisition market, not just what’s covered in major media. Take advantage of our limited time two-for-one offer: Order by July 31st and receive the 2013 Edition for FREE! Go to http://www.levinassociates.com/home-health-description or call 800-248-1668 to order today.
 
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