The Carlyle Group acquired Franklin Park at Cityview, a 203-unit independent living community in Southwest Fort Worth, TX said the company on Monday.
Upon closing, the community will be renamed Vantage at Cityview and Leisure Care will become property manager.
Built in 2004, the facility spans 24 acres and includes a heated swimming pool, nine-hole putting green, fitness center, theatre, full-service salon, transportation services, and a restaurant. Carlyle said it expects to spend more than $1 million after closing to upgrade the property, including refreshing the common areas and enhancing the food service program.
“We are excited to share our vision of Five-Star Fun with the residents of Franklin Park. They have a beautiful building to call home and we are anxious to provide the engaging programs and services that will create a world class retirement experience for them,” said Jason Childers, Senior Vice President, Leisure Care. “This addition to the Leisure Care portfolio continues our business plan of expanding our services to new locations and marks what we believe will be a great partnership with The Carlyle Group.”
“Franklin Park at Cityview is a great community in a strong submarket of Fort Worth,” said Thad Paul, Principal, US Real Estate at The Carlyle Group. “By combining our proven real estate success and Leisure Care’s strong operational leadership, we are confident this community will be an outstanding performer for our portfolio.”
With the addition of Franklin Park, Leisure Care now operates 38 communities in the US and Canada.
The transaction is the group’s 30th investment in the senior housing sector. Details of the deal were not disclosed.
With loads of inventory, high end retirement communities across the country are re-vamping their marketing strategy to boomers according to the Wall Street Journal.
“Retirement communities in Arizona, California, Florida and other vacation destinations are pitching older Americans so-called retirement getaways, a few nights in a model home with access to all the luxury amenities,” reports the WSJ.
The test drive before you buy approach seems to working. According to the article:
For example, since January 2010, the Trilogy at Monarch Dunes reports that more than 20% of the couples who bought their test-drive package went on to buy a home – about 32 couples. Across the Robson Resort Communities’ seven retirement properties, roughly 75% of the 3,200 people who participated in its getaway program are now permanent residents, according to a spokesperson for the company. “It’s a good sales tool for communities because people might have doubts, but when they get there they can see the advantages and disadvantages,” says Sandra Timmermann, executive director of the MetLife Mature Market Institute.
Some of the communities are offering the opportunity to for free but others can cost as much as $200 per night. Factor in the meals and transportation and it could end up costing consumers significantly more. Don’t forget about the sales pitch that borrowers will have to sit through either.
A spokesperson for Robson Communities told the WSJ that for its Pebble Creek community, consumers will spend about an hour with a sales associate, who talks about the community, gives you a tour and hands you a personalized itinerary for the weekend, including dinner with a resident couple.
Health Care REIT, Inc. (NYSE:HCN) announced operating results for the first quarter of 2011 that showed HCN’s revenues increased to $255 million versus $145 million in Q1 2010. The higher revenues were offset by higher expenses, including $36 million in integration costs. The company’s Q1 earnings were $31.8 million, or 15 cents a share, up from $31.7 million, or 21 cents a share, a year earlier. HCN’s Funds From Operations (FFO) fell to 46 cents a share from 51 cents a share.
Health Care REIT completed the previously announced $298 million partnership with Silverado Senior Living during the first quarter of 2011 where it acquired a 95% interest to own and operate 18 senior housing facilities with 1,454 beds located primarily in California and Texas. The company also completed the previously announced $890 million partnership with Benchmark Senior Living. The transaction called for HCN to acquire a 95% interest to own and operate 34 senior housing facilities with 3,009 units located primarily in New England. Benchmark will continue to manage the facilities and own the remaining 5% interest.
“Health Care REIT remains on target to deliver strong 2011 earnings growth of 8-11%,” commented George L. Chapman, Health Care REIT’s Chairman, Chief Executive Officer and President. “We recently closed the Genesis HealthCare and Benchmark Senior Living transactions on or ahead of schedule. These closings allowed us to recently raise our 2011 FFO guidance by seven cents as these transactions will be immediately accretive to earnings. The $7 billion of new partnerships formed in 2010 and 2011-to-date demonstrates the successful execution of our relationship investment strategy and positions the company for a strong period of earnings and dividend growth over the next several years.”
Despite the increasing need for long term care, only 1 in 10 Americans aged 55 and older had private long term care insurance in 2008 according to the a new report from the Urban Institute.
Most Americans will eventually need long-term care, which is often expensive and not usually covered by public programs until recipients have nearly exhausted their savings. In 2009, 5.2 million Americans age 65 and older not living in institutions had long-term care needs
Of those covered, those with incomes of more than $100,000 were twice as high.
Private insurance covered only 7 percent of the $240 billion in U.S. long-term care costs in 2009. Nearly a fifth were paid out of pocket.
View a copy of the report here.
Leisureworld Senior Care Corporation (TSX:LW) completed the acquisition of two Royalton retirement residences in Kingston and Kanata, Ontario on Thursday.
LW paid $89 million for the two facilities (294 suites total) after working capital adjustments and a holdback of $5.5 million to be held in escrow as an income guarantee to complement cash flow from the properties during the lease-up period said the company.
“As brand new luxury retirement living properties featuring top quality amenities which are competitively positioned in attractive markets, the retirement residences will be marketed under the Company’s ‘The Royale’ brand,” said Leisureworld.
To finance a portion of the purchase, the company entered into a two-year bridge debt facility with a Canadian chartered bank in the amount of $55 million. After putting in place interest rate swap arrangements, the all-in cost of borrowing under the facility will be approximately 4% per annum.
The balance of the purchase price was funded from the net proceeds of the Company’s recently completed public offering of subscription receipts, which raised gross proceeds of approximately $46 million. On closing of the Acquisition, one common share was automatically issued in exchange for each outstanding subscription receipt, resulting in the issuance of 4,381,500 common shares.
Leisureworld owns and operates 26 LTC homes, representing approximately 4,314 beds across Ontario, Canada. In addition, the company also owns and operates three retirement homes with 323 suites and one independent living home with 53 suites.