DALLAS — HFF (NYSE: HF) has closed the sale of a 12-property SunnyBrook seniors housing portfolio totaling 680 units located across Iowa. HFF marketed the property on behalf of the seller, SunnyBrook Senior Living. American Realty Capital Healthcare Trust II (ARC) purchased the assets for $164.2 million, which represents a cap rate near 7.2 percent based upon 2014 pro forma financials. A 13th asset is under contract and will close at a later date.
The housing in the portfolio was built between 2003 and 2009, with 544 assisted living units and 136 memory care units featuring studio, one- and two-bedroom floor plans. The properties are located in Burlington, Carroll, Fairfield, Fort Madison, Mt. Pleasant, Muscatine, Cedar Rapids, Clinton, Des Moines, Independence, Ottumwa and Tipton. Average occupancy of the buildings was 93 percent at the time of close.Ryan Maconachy and Chad Lavender with HFF represented the seller.
Whit Roberts and Janis Loegering with the Dallas office of Locke Lord LLP provided legal representation for SunnyBrook. Taylor Pancake with the Orlando office of law firm Foley & Lardner represented ARC.
“The SunnyBrook Portfolio represented a great opportunity for ARC and their new operating partners for this portfolio, Provision Living and Frontier Management, each bringing significant operating experience in the region,” says Maconachy. “The HFF Seniors Housing Team was very pleased with the execution of the transaction by the teams at SunnyBrook and ARC, which was completed over a compressed timeline.”
CEO and majority owner of SunnyBrook James T. Elliott IV moved his family to Iowa from New York City 10 years ago. Elliott developed the properties and then assumed a role with the management of SunnyBrook.
ARC is a full-service investment advisory firm sponsoring a series of investment programs with an emphasis on publicly registered, non-traded real estate offerings. The company was formed by Nicholas Schorsch and William Kahane.
HFF (Holliday Fenoglio Fowler, L.P.) and HFFS (HFF Securities L.P.) are owned by HFF Inc. HFF operates out of 23 offices nationwide and provides commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF’s services include debt placement, investment sales, equity placement, advisory services, loan sales and commercial loan servicing.
— Haisten Willis