Sonida Senior Living Announces Agreement to Acquire Two Senior Living Communities in the Indianapolis Market
December 16, 2021
Sonida Senior Living, Inc. (the “Company” or “Sonida Senior Living”) (NYSE: SNDA), a leading owner-operator of senior living communities, announced that it entered into a purchase and sale agreement to acquire two recently renovated senior living communities for approximately $12.3 million.
The communities, Northfield Senior Living and Southfield Senior Living, include 157 independent living units and are located approximately 20 minutes outside of downtown Indianapolis near major highways, stores and restaurants. The assets complement Sonida Senior Living’s existing Indianapolis portfolio and will leverage the strength of the Company’s local leadership team. The Company expects the acquisition to close in the first quarter of 2022 subject to customary closing conditions.
“This transaction represents the Company’s approach to pursuing accretive, tuck-in growth in markets where we have operational expertise and can leverage deep market knowledge and scale,” said Kimberly S. Lody, President and CEO. “The signing of this acquisition marks the Company’s shift into the growth phase of our strategic plan following the recently closed $154.8 million capital raise and strategic investment from Conversant Capital.”
The properties recently underwent a significant refurbishment, and the Company’s purchase price, equating to approximately $79,000 per unit, represents a significant discount to replacement cost. Demographics in the surrounding market area include a growing 75+ population with above average middle-income characteristics and unmet demand for this type of low-acuity senior living product. Due to the operational disruption from the renovation projects prior to the onset of COVID-19, the two assets have an in-place November occupancy of 55.5%, as compared to Sonida Senior Living’s independent living occupancy of 82.7% for the same period. By implementing Sonida Senior Living’s institutionalized processes and resources, the Company expects to deliver NOI growth through lease up and additional resident services with the assets projected to generate a 9% stabilized NOI yield (unlevered).