Formation Capital is an equity investment and asset management company in the senior housing and care industry. The unique integration of real estate and operating dynamics in this asset class make it unlike any other real estate investment platform. For this reason, Formation Capital has developed an experienced staff and unique approach to investing in and overseeing this sector and asset class.
Formation Capital sees the senior housing business, more specifically the nursing care industry, as a hybrid of real estate and operating business. This dynamic encouraged them to design a unique investment approach. Formation Capital targets high quality operating companies and has designed an approach which separates the real estate (capital infusion) and the operating company (triple net lease). This structure allows for value enhancement in the future, based on the economics of the potential arbitrage between real estate markets, capital or corporate markets, should one or the other trade at a premium. For instance, if the real estate markets were to decline but the corporate or public markets became enhanced, their model allows for them to realize that arbitrage through their alignment and structure. Formation believes that this is the most applicable and appropriate structure for both investors and operators.