Property Types Seniors Housing
Emeritus Nabs 5 Assisted Living Communities
Aug 4, 2008
By: Michael Fickes, Contributing Correspondent

Seattle-based Emeritus Corporation has agreed to purchase five assisted living communities, currently leased to the company, for $62.5 million, plus estimated closing costs of $2.8 million. Located in Ohio, Florida, California and Michigan, the five communities comprise 432 units.

The transaction will increase the company’s portfolio of owned properties to 154 or 60.4 percent of the total Emeritus portfolio of 289 communities.

This is the third acquisition that Emeritus has announced during 2008. In early June, the company announced the acquisition of 29 communities for $299.8 million, excluding transaction costs. In February, the company announced a $305 million deal for 23 communities.

In each case, Emeritus is buying communities it is currently leasing. “We are continuing to pursue our long-term real estate strategy of purchasing communities that we currently lease, where appropriate,” Granger Cobb, co-CEO of Emeritus, told CPN. “We see strong value in owning properties that are tied to our business as it guarantees us 100 percent of the upside value created through the business as well as the intrinsic real estate appreciation. We will continue to be opportunistic in looking at future acquisition opportunities.”

Emeritus plans to finance the transaction announced today through mortgage debt equal to about 75 percent of the purchase price, seller-provided financing of $10 million and the balance from the refund of certain security deposits and cash on hand. The seller will finance the $10 million for three years at an annual interest rate of 8 percent, set to increase annually by 25 basis points. Monthly payments will equal accrued interest plus a principal payment of $40,000.

Emeritus is a national provider of assisted living and Alzheimer’s and related dementia care services to seniors. The company currently operates 289 communities in 36 states and assists 29,500 residents.

 
Recent Seniors Housing Headlines
Senior Living Facilities Draw More Men
Aug. 18, 2008
Senior living communities, traditionally home to populations of predominantly female residents, are now experiencing significant growth of their male populace. The trend is particularly prevalent at independent living facilities--be they dedicated independent living properties or housing units within continuing care retirement communities.
HCP Wraps Up $500M Offering
Aug. 13, 2008
Long Beach-headquartered HCP Inc. has just concluded its offering of 14.95 million shares of common stock, which, at a price of $33.50 per share, yielded the healthcare REIT an aggregate $500 million. The company originally priced the offering of just 13 million shares on August 6 with hopes of taking in $435 million. HCP plans to use the proceeds from the offering to repay part of its outstanding debut under a bridge loan facility. In other recent financial transactions, in late May, the company placed $259 million of secured debt on 21 of its nearly 300 senior housing properties. The debt, featuring a seven-year term with a fixed interest rate of 5.83 percent, was provided by Grandbridge Real Estate Capital L.L.C. and purchased by Fannie Mae.
Life Sciences Trends Point to Continued RE Demand
Aug. 12, 2008
The life sciences industry's real estate needs in the nine key U.S. markets continue as soaring construction costs hinder the upgrading of existing office space, international players compete for the limited pool of high-end accommodations and businesses increase reliance on outside real estate services providers, according to a new report by CB Richard Ellis Inc.
Warren, Mitchell LaSalle, Constant Care Look to New Leadership for Growth Initiative
Aug. 12, 2008
Assisted living developer the LaSalle Group and management firm Constant Care Management Co. have made changes to their corporate structure in an initiative to spearhead growth. Mitchell Warren has taken over as president of LaSalle and is now overseeing continued expansion plans for the company and complete asset management. Warren was formerly vice president of development for LaSalle, and led the company’s expansion plans through the Dallas Fort Worth area and Chicago, with responsibilities ranging from new business to new residence planning and development.
Hospitality Design Group Enters Luxury Senior Living Market with 410-Unit Resort-Style Project
Aug. 06, 2008
Los Angeles-based Cheryl Rowley Design, a 20-year-old hospitality design group, is venturing into the luxury senior living market, with Maravilla, a 410-unit resort-style senior living facility in Scottsdale, Ariz.
 

 

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