Seniors Housing Business

AUG-SEP 2018

Seniors Housing Business is the magazine that helps you navigate the evolution of the seniors housing industry.

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Acquisitions 14 www.seniorshousingbusiness.com Seniors Housing Business n August-September 2018 Principals of the CBRE National Senior Housing team completed nearly $11 billion in senior housing investment sales and debt transactions between 2014 and 2018, encompassing over 50,000 units across the United States. How can we help you transform your real estate into real advantage? cbre.us/nationalseniorhousing Matthew Whitlock Capital Markets Investment Sales/ Debt & Structured Finance +1 978 282 0024 matthew.whitlock@cbre.com Aron Will Capital Markets Debt & Structured Finance +1 713 787 1965 aron.will@cbre.com Lisa Widmier Capital Markets Investment Sales/ Investment Banking +1 858 729 9890 lisa.widmier@cbre.com SENIOR HOUSING MARKET MAKERS LCS Acquires 299-Unit CCRC in New Jersey Bridgewater, N.J. — LCS has acquired Arbor Glen, a continuing care retirement community (CCRC) in Bridgewater, for an undisclosed price. Located southwest of New York City, the community sits on 23 acres and features 183 independent living units, 19 independent living villas, 23 assisted living units, 10 memory care units and 64 skilled nursing beds. LCS changed the community's name to Laurel Circle and plans to implement an $8 million capital improvement plan at the property. Cushman & Wakefield's Allen McMurtry, Paul Carr and David Kliewer represented the seller and former operator, Friends Retire- ment Concepts, in the transaction. Based in Des Moines, Iowa, LCS Real Estate has executed on acqui- sition and development transactions in excess of $800 million since 2016. The company currently has an ownership stake in 37 seniors housing communities nationwide, including 13 CCRCs. Arbor Glen in Bridgewater, New Jersey, offers 299 units of seniors housing spanning the continuum of care on a 23-acre site. Welltower, ProMedica complete $4.4 billion acquisition of QCP Toledo, Ohio — A joint venture between Toledo-based healthcare REIT Welltower (NYSE: WELL) and nonprofit healthcare operator ProMedica Health System has com- pleted its previously announced acquisition of Quality Care Proper- ties (NYSE: QCP). QCP stockholders approved the sale, which was the last hurdle to the deal's completion. Stockhold- ers will receive $20.75 in cash for each share of QCP stock. Although initially reported as a $2 billion sale when the deal was announced in April, Welltower is now claiming the value as $4.4 billion. The in- creased price is the total enterprise value, including the joint venture's investment in both QCP and HCR Manorcare plus the acquired com- panies' assumed debt. The joint venture acquired the real estate of QCP's principal ten- ant, HCR ManorCare, the nation's second-largest nursing home chain. Toledo-based HCR ManorCare filed for Chapter 11 bankruptcy in March after struggling to pay rent to QCP, which owns nearly all of the facilities that HCR ManorCare operates. QCP itself is a spin-off of health- care REIT HCP (NYSE: HCP), which created the company in 2016 specifically to remove HCR Manor- Care's 320 properties from its port- folio. ProMedica will operate the mas- sive HCR portfolio, and plans to in- vest up to $400 million in upgrades over the next five years. "At the heart of this transaction is the need to shift care delivery into new, more cost-effective settings as well as to expand our unique wellness-focused strategy as we scale nationally," says Randy Oos- tra, ProMedica president and CEO. "This is our opportunity to rede- fine the settings of effective care de- livery outside of the hospital walls for aging seniors and enhance our service offering to span the entire continuum of care, including home health, post-acute care and residen- tial memory care." The HCR ManorCare chain has more than 50,000 employees pro- viding services in 450 assisted liv- ing facilities, skilled nursing and rehabilitation centers, memory care communities, outpatient rehabilita- tion clinics, and hospice and home health agencies operating under the names of Heartland, ManorCare Health Services and Arden Courts. Through this transaction, Pro- Medica, which operates in six states, will expand its footprint into 30 states, employing approximate- ly 70,000 people with projected an- nual revenues of $7 billion. Goldman, Sachs & Co. LLC and Lazard are financial advisors to QCP. Wachtell, Lipton, Rosen & Katz is legal advisor to QCP. Sabra sells 10 communities for $88.4 million Irvine, Calif. — Sabra Health Care REIT (NASDAQ: SBRA) has com- pleted the previously announced sale of nine facilities leased to Genesis Healthcare for $81.4 mil- lion, and one leased to Signature HealthCARE for $7 million. The Genesis communities includ- ed seven skilled nursing facilities and one continuing care retirement community, while the Signature property was a skilled nursing fa- cility. The specific names, locations and buyers of the communities were not disclosed. The deals will reduce Genesis' annual rent obligations to Sabra by $7.4 million, and Signature's by ap- proximately $600,000. Sabra plans to use the proceeds from these sales to repay borrow- ings under its revolving credit fa- cility. Blueprint brokers sale of nine-facility skilled nursing portfolio for $82 million Chicago — Blueprint Healthcare Real Estate Advisors, a Chicago- based brokerage firm, has arranged the sale of nine skilled nursing facilities in California, Colorado, Idaho, North Carolina, New Mex- ico, Rhode Island, Washington and West Virginia. A publicly traded REIT sold the portfolio for $82 million. The buyer, a private equity investor, entered into a new triple-net lease with the existing operator. The deal is part of a staggered asset sale that will include another four assets follow- ing the assumption of HUD debt. Totaling 981 licensed beds, the portfolio price equates to approxi- mately $83,000 per bed. The capi- talization rate was roughly 9 per- cent. Blueprint's Christopher Hyldahl, Ben Firestone, Gideon Orion and Michael Segal handled the transac- tion.

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