Griffin-American Healthcare REIT IV Acquires Two-Property Central Wisconsin Senior Care Portfolio for $22.6 Million
March 7, 2018
MADISON, WI–American Healthcare Investors and Griffin Capital Company, LLC, the co-sponsors of Griffin-American Healthcare REIT IV, Inc., announced today the REIT has completed the acquisition of the 254-bed, two-property Central Wisconsin Senior Care Portfolio for approximately $22.6 million. The portfolio’s properties are located in the Madison suburbs of Waunakee and Sun Prairie, WI.
Central Wisconsin Senior Care Portfolio totals approximately 236,000 square feet of skilled nursing, assisted living and independent living space. All assisted and independent living beds in the portfolio are currently 100 percent private pay, while the skilled nursing beds enjoy an attractive revenue quality mix (total number of Medicare, managed Medicare and private pay days divided by total number of actual patient days) of 67 percent as of November 2017.
Both facilities have been awarded coveted five-star quality measures ratings from the Centers for Medicare & Medicaid Services in recent years. Significant renovations and capital investments to both properties totaling approximately $9.4 million have been completed since 2006.
The portfolio is master leased under an absolute net structure through 2033 with two 10-year renewal options to an entity affiliated with Integro Healthcare Consulting, LLC. The master lease includes annual rent escalators of between 2 percent and 2.5 percent. Founded in 2004, Integro Healthcare Consulting has operated 27 senior housing and skilled nursing facilities throughout the Midwest and western United States.
“Central Wisconsin Senior Care Portfolio provides the REIT with a foothold in Wisconsin, a state with a significant barrier to entry for skilled nursing operators due to a moratorium on development that has been in effect since 1981,” said Stefan Oh, executive vice president of acquisitions for American Healthcare Investors and Griffin-American Healthcare REIT IV.
“Additionally, we believe this acquisition will provide Griffin-American Healthcare REIT IV and our investors with greater value as our chosen operator, Integro Healthcare Consulting, has an established history of enhancing both patient care and financial performance at the facilities under their administration since their founding more than 14 years ago,” Oh said.
Central Wisconsin Senior Care Portfolio was acquired from Waunakee Manor, a Limited Partnership, and Sun Prairie Associates Limited Partnership, unaffiliated third parties represented by William Mulligan, Nicholas Glaisner and Ashley Wilkens of Ziegler Investment Banking.
Griffin-American Healthcare REIT IV purchased its first property in June 2016 and, as of the date of acquisition of Central Wisconsin Senior Care Portfolio, has acquired a portfolio of 42 medical office buildings, senior housing facilities and skilled nursing facilities for an aggregate contract purchase price of approximately $489 million.