Bickford Senior Living, a Kansas City-based developer and operator of assisted living and memory care communities, and private equity firm Harrison Street Real Estate Capital have entered into a joint venture to acquire and recapitalize six assisted living and memory care communities that Bickford currently manages for approximately $62 million.
These assets will serve as the foundation for what the partnership hopes will become one of the “preeminent portfolios of assisted living and memory care properties” in the central Midwest.
The partnership already has assembled a pipeline of future acquisition andopportunities, and could make total investments exceeding $200 million.
Bickford currently operates more than 2,000 assisted living and memory care units.
The initial investment was made on behalf of the new company created by the partners, of which both members invested in the assets.
The majority of the equity came from Harrison Street Real Estate Partners III LP, the third fund launched by-based Harrison Street Real Estate Capital. The firm invests in the education, health care and storage segments of the real estate market.
The properties acquired by the partnership include six Bickford Senior Living communities in the Chicago, Kansas City, Omaha and Des Moines metro areas.
This portfolio consists of 342 private-pay rental units that generally cater to an affluent resident base that is in need of assisted living and memory care.
The partnership’s future business plan involves developing, acquiring, repositioning and operating assisted living and memory care properties with a regional emphasis in the Midwest.
This strategy builds on Bickford’s existing portfolio of more than 40 seniors housing communities strategically located in Illinois, Indiana, Missouri, Kansas, Iowa and Nebraska.
The partnership is currently evaluating opportunities to develop and acquire additional senior housing assets that can benefit from Bickford’s development and operating expertise, reputation and infrastructure.
The joint venture seeks to complete approximately $150 million in additional transactions during the next three years.
"We have developed a strong relationship with Harrison Street during the past year,” says Michael Eby, president of Bickford Senior Living. “It is their overall philosophy, knowledge of the senior housing sector, partner focus and access to capital that led our decision to team with them.”
Harrison Street's real estate assets under management total approximately $2.7 billion, including a senior housing portfolio of more than 5,000 units.
Eby adds that through Harrison Street University — an in-house training center — Bickford is able to draw on valuable resources that help the business operate better and more efficiently.
“Bickford is one of the most recognized and respected senior housing brands in the central Midwest, with a strong reputation for providing top-notch care to its residents,” says Michael Gordon, senior vice president of Harrison Street Real Estate Capital.
“Our partnership will focus on leveraging Bickford’s existing platform to strategically increase its footprint within its current markets and expand into new markets,” explains Gordon, “with an emphasis on quality and controlled growth.”