From The Magazine

Owners and operators test new strategies and scrutinize all expenses as the number of financially beleaguered assets multiplies. By Jane Adler Despite encouraging signs of a seniors housing turnaround, the challenging operating environment is creating an uptick of troubled properties in need of their own turnaround.  The triple whammy of the pandemic, rising interest rates and higher expenses has hit the sector hard. Margins are squeezed and valuations are depressed. What’s more, the recent banking crisis and the growing prospects for a recession have added to financial pressures.  “There’s a …

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With high inflation eating away at personal savings, the number of low-income seniors is growing and LIHTC development struggles to keep up. By Jeff Shaw Today’s high inflationary environment is tough on everyone, but persons of limited financial means are getting hit the hardest. Most affordable seniors housing properties are fully occupied with a long waiting list, signaling that there is a strong need for the product. But the myriad issues facing the commercial real estate industry — especially rising construction costs — have an outsized impact on affordable housing …

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With its acquisition of Cadence Living, Cogir Senior Living is building a company with wide-ranging expertise. By Jeff Shaw In a time when large-scale, entity-level acquisitions have been nearly non-existent, Cogir Senior Living’s acquisition of Cadence Living in November stood out. Both companies have a focus on the West Coast, and the combined total number of units is approximately 8,000 across nine states, making the company the 21st largest operator in the United States. Cogir is the Sacramento-based subsidiary of Cogir Services LP, a Montreal-based real estate company operating over …

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High interest rates, rising expenses curb transactions, cast spotlight on bridge loans. By Matt Valley and Jeff Shaw To borrow a baseball phrase, the rallying cry among lenders in the HUD Lean Section 232 mortgage insurance program used to finance nursing homes and assisted living facilities is “Wait ’Til Next Year.” The combination of rising interest rates and volatility in the capital markets has led to a slump in deal volume, but lenders see this situation as a temporary setback.  Transaction activity has actually been waning the past few years. …

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Financing vehicle enables private equity firms to open another revenue line while offering borrowers an option when lenders are scarce. By Jeff Shaw The growing popularity of private equity-backed debt funds is a win-win for many of the players involved. Rather than use their capital to buy more properties, private equity investors can lend money as a lower-risk, fixed-income alternative to owning assets. Borrowers have another source of debt, especially at a time when lenders may be scarce. Just as banks, for example, were re-entering the seniors housing fray following …

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While financing sources appeared to return to form in early 2022, volatility in the capital markets ultimately throttled down deal volume in the second half of the year. By Jeff Shaw At first glance, 2022 looks like a partial return to pre-pandemic form for Fannie Mae and Freddie Mac’s deal volume within the seniors housing sector. After major downturns in 2020 and 2021, Fannie Mae’s volume rose 26 percent from $800 million in 2021 to $1 billion in 2022. Freddie Mac’s volume rose 29 percent from $2.1 billion to $2.7 …

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By Matt Valley March is notoriously volatile weather-wise, but March 2023 will long be remembered as a particularly stormy month for the financial markets. The collapse of two banks over a 48-hour period early in the month hit like a bolt of lightning. Santa Clara, California-based Silicon Valley Bank, a lender to technology startups, failed following a bank run during which depositors and investors withdrew $42 billion on March 9 alone. On March 10, the bank was placed under the receivership of the Federal Deposit Insurance Corp. (FDIC). Two days …

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After transaction volume rebounded greatly in 2021, sales fell 38 percent in 2022 as economic hardships mounted. By Jeff Shaw I get knocked down, but I get up again  You are never gonna keep me down  The lyrics to the song “Tubthumping” by former British rock band Chumbawamba are an apt description of the seniors housing industry because of its resiliency in the face of adversity over the past three years. The COVID-19 pandemic delivered the first blow in early 2020, leading to a rise in deaths at communities, declining …

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Operators leverage Internet of Things platforms to improve health and well-being of seniors while maximizing workflow and revenues. By Eric Taub The so-called smart home is fast becoming the standard home. Today, everyday appliances such as refrigerators and ovens in addition to lighting and HVAC can be controlled via the internet. Now, that same technology is increasingly being employed in senior living as a way to increase resident well-being and improve a community’s operating efficiencies and bottom line. It’s called IoT, or the Internet of Things, a phrase that defines …

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Investors and customers are increasingly drawn to companies that embrace environmental, social and governance policies, but the success of these initiatives hinges on transparency and authenticity. By Jeff Shaw A company could be forgiven for wanting to avoid developing and implementing an ESG (environmental, social and governance) strategy. Enacting concrete policies to address the desired goals in these areas, then tracking and reporting results to stakeholders, is a time- consuming and costly process. For background, the “environmental” piece of the equation relates to how a company operates in a way …

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