Brad Clousing Notches Another Florida Sale

Brad Clousing sold a 58 unit Assisted Living Community in Tampa, Florida. The building was constructed in 1984 and 1986 and is approximately 26,840 square feet.. It features 40 units with shared bathrooms and 18 resident units with private bathrooms. All of the 58 units have capacity for two residents. Although many of the residents are private pay, a significant percentage of residents are reimbursed through the Med Waiver/Diversion program. The Seller is primarily a skilled nursing operator and is planning on focusing on core operations in the skilled nursing sector. The Buyer is a regional owner/operator that is expanding their footprint in Florida. For additional information, please contact Brad at clousing@slibinc.com or 630/858-2501.

Matthew Alley Sells Another Texas SNF

Matt Alley has sold another Skilled Nursing Facility in Texas. The property consists of 199 licensed beds/165 usable beds. The facility was built in 1963 with an addition in 1973 and most recently remodeled/upgraded in 2011. The facility enjoys a strong census (84%) but is reliant upon Medicaid residents(80%). The single story building consists of 47,250 square feet and is located approximately 90 miles east of Houston. The property sold for a 13.3% capitalization rate/1.03 EGIM. The Seller was a regional owner/operator. The Buyer is an owner/operator from the Dallas/Ft. Worth area with several facilities throughout Texas. For more information, please contact Matthew Alley at alley@slibinc.com or 630/858-2501.

Toby Siefert and Ryan Saul Complete Skilled Nursing Sale in Pennsylvania

Ryan Saul and Toby Siefert recently sold a 97 Bed Skilled Nursing Facility in Pennsylvania. The Seller was a regional not-for-profit that had engaged Genesis Healthcare to manage the community. The property had bond financing and the hold on the bond was achieved. It was a mutual decision by the owner and the bondholder to divest of the community. The property was not in a core market of the owner or manager. The Buyer was a regional owner with other seniors housing properties in Pennsylvania. The 24,000 square foot building was built in 1967 and 1972 on 0.69 acre. The census at the time of sale was 89.9% Senior Living Investment Brokerage was able to procure multiple offers for the Seller. For additional information, please contact Toby or Ryan at 630/858-2501.

Ryan Saul Completes Indiana Nursing Home Sale For Record Price

Ryan Saul sold an 128 Bed Skilled Nursing Facility in Fort Wayne, Indiana. The facility has a stellar reputation for quality care which was reflected in the purchase price of over $100,000/bed. Although originally built in the 1970.s, the Seller had continually invested capital and upgraded the building. It is arguably one of the best SNF's in Indiana. The Seller was an Assisted Living owner/operator that purchased the SNF because it was adjacent to one of his ALF's. The Seller had recently sold his Assisted Living portfolio so he elected to sell the SNF. The Buyer, based in Chicago, aligned with a regional to operate the facility. The operator manages several properties in Indiana and Illinois. The 37,000 square foot building on 4.3 acres was built in the 1970's. The census at the time of sale was 84% with an 80% quality mix. The community sold at a 14.13% capitalization rate/1.4 GIM. For additional information, please contact Ryan Saul at ryansaul@slibinc.com or 630/858-2501.

Ryan Saul Achieves Record Price for Illinois Skilled Nursing Facility

Ryan Saul has sold a 292 Bed Skilled Nursing Facility in Norridge/Chicago, Illinois. The 99,979 square foot building on 1.36 acres, sold for over $135,274/bed, a record for Illinois. The Seller is a regional owner/operator who plans on focusing his energies on his other skilled nursing facilities in the Chicagoland area. The Buyer is a Chicago based owner that aligned with a local operator to run the property day to day. The overall census at the time of sale was 89% (23% Medicare/13% Private Pay). The price reflected the reputation of the property coupled with the rare opportunity to acquire facilities on the north side of Chicago. The capitalization rate at the time of sale was 8.10% on approximately $24,000,0000 in revenues. Aside from the record price per bed, the transaction took 47 days from listing engagement to closing. For additional information on this transaction or how Ryan can assist you in buying or selling your seniors housing community, contact Ryan Saul at 630/858-2501 or ryansaul@slibinc.com

Ryan Saul Sells 50 CON Beds in Ohio

Ryan Saul has sold 50 Certificate of Need (CON) Beds in Ohio.  The Seller was looking to retire from the business and this was the only property he owned.  Because the facility was originally constructed in 1897 as a hospital and renovated in 1945, it was functionally obsolete.  Therefore, Senior Living Investment Brokerage, Inc. was able to sell the beds and the owner donated the vacant building to a not-for-profit for the tax benefit.  The Buyer is a regional owner/operator with 8 facilities in Western Ohio.  This was a strategic acquisition as they are focused on growing their regional company.  The Buyer plans on building a campus nearby that includes assisted living and skilled nursing.  For additional information, please contact Ryan Saul at ryansaul@slibinc.com or 630/858-2501.  Congratulations Harry and enjoy your retirement.

Senior Living Investment Brokerage Sells Nebraska Assisted Living Community

Jeff Binder, Brad Clousing and Ryan Saul teamed together to sell a Nebraska Assisted Living Community for $6,600,000.  It is a purpose built (2002/2005), quality facility offering a mix of assisted living and memory care units.  The facility is also set up to accept Medicaid residents.  Although the occupancy in 2011 struggled, it has historically done well and recovered in 2012.  The Seller was a partnership with plans to redeploy capital to other uses.  The GP owns assets in other states and plans on focusing his attention and resources on those assets.  The Buyer sees significant upside in the facility and has other operations in the region.  They will focus on increasing the private pay occupancy.  There is an additional 1.5 acres of land adjacent to the facility to develop independent living units or expand the existing AL/MC.  For additional information contact Jeff Binder at 314/961-0070 or Brad and Ryan at 630/858-2501.  www.slibinc.com

Jeff Binder and Ryan Saul Sell 6 Property Skilled Nursing Facility Portfolio

Ryan Saul and Jeff Binder were engaged to sell an 824-bed, six facility skilled nursing portfolio in Illinois.  The properties were constructed between 1963 and 1996.  The facilities census in 2012 averaged 74% (14% private pay/15% Medicare payor mix).  Revenues were $45,000,000 and the purchase price was $48,500,000.  The Seller is an owner/operator of long-term care properties in the Midwest.  The Buyer is an Illinois based owner/operator of seniors housing facilities.  The Buyer plans on focusing on improving the overall occupancy and specifically the Medicare census.  An additional benefit for the buyer will be the incorporation of the $3.0 million management fee.  An Illinois bank provided financing.  For additional information, contact Jeff Binder at binder@slibinc.com or Ryan Saul at ryansaul@slibinc.com   

Toby Siefert and Ryan Saul Handle Pennsylvania Personal Care Home Sale

Ryan Saul and Toby Siefert have sold a 65 Unit/68 Bed Personal Care Home. The facility census at the time of contract was 85% and was in the process of lowering the SSI residents. By the time the transaction closed, the census had returned to 100%. The facility sold for a 7.5% capitalization rate/1.48 GIM. This was the Seller's only facility and the partners are retiring from the business. The Buyer, based in Eastern Pennsylvania, was looking to expand beyond the few facilities they owned in the area. The transaction was financed by the same bank that held the Seller's mortgage. For additional information please contact Toby or Ryan at 630/858-2501 or siefert@slibinc.com ryansaul@slibinc.com

Brad Clousing, Jeff Binder and Ryan Saul Sell Florida ALF Portfolio

Senior Living Investment Brokerage, Inc. sold 4 Assisted Living Facilities in Florida.  Three of the facilities were located near each other offering complementary services.  The fourth facility is located in an area where there is a high demand for assisted living services.  The overall census was 89% for the 165 units.  The facilities were built in 1984, 1991, 1993 & 1996.  The Buyer was a REIT who entered into a long term lease with a regional operator.  The portfolio sold for $14,100,000 which translated into a 9.67% capitalization rate.  For additional information, please contact Brad at clousing@slibinc.com, Jeff at binder@slibinc.com or Ryan at ryansaul@slibinc.com    

Impact of Tax Hikes on Senior Housing M&A Market

After the American public spent much of 2012 contemplating the uncertainty in Washington, President Obama and Congress were able to engineer a last-minute deal that addressed the President's campaign to raise tax rates on wealthy Americans and avoided the revenue side of the Fiscal Cliff.

Tax rates were raised on incomes above $400,000 for single earners and $450,000 for married couples, which I will define as the "top tax bracket".  It also blocks spending cuts, also known as "the sequester" for two months, which sets up a whole new negotiation at the end of February.  How that might affect Medicare and Medicaid reimbursement is a topic for another time.

What does this mean to the senior housing M&A market? For earners in the top tax bracket, capital gains tax rates will increase from 15% to 20%.  As of now, there will also be a 3.8% tax on capital gains for the Affordable Care Act, which is more commonly known as "Obamacare". These increases in capital gains tax rates led to a flurry of transactions being completed in the fourth quarter of 2012.

This uptick in activity has led to very little senior housing inventory being on the market currently, with many sellers opting to list their properties in the latter half of 2012, as opposed to wait until 2013 in order to lock in more favorable tax treatment.

How can this help sellers of senior housing facilities? The change in tax treatment for sellers has not affected buyers' appetite for acquisitions, as there is still a great deal of equity and debt financing available for strong operators throughout the country.  With many aggressive buyers at the table and little inventory available, simple supply & demand economics would suggest that the first half of 2013 will see an increase in pricing for senior housing facilities.

As a potential seller, what should I do? While there is still a lack of quality inventory on the market, it might make sense to pull the trigger on selling your senior housing asset.  I believe that as the year goes on, more owners will try to take advantage of strong pricing multiples, which will lead to a greater supply and less attention to each specific listing.

If you are interested in selling or are just curious of your facility's value, Senior Living Investment Brokerage, Inc. provides non-binding marketing proposals.

We sold over $260 million in senior housing facilities in 2012.  We would be privileged to work with you in the sale of your facility.

Contact me via email at alley@slibinc.com or phone at (630) 858-2501.

Matthew Alley
Managing Director