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A Pres-Defined U.S. Healthcare Care Real Estate Investment Program

Our Joint Venture Partner program allows family office investors and Healthcare professionals access to COGP & JVP programmatic deal flow.

You will be aligned with top-performing Seniors Housing funds and the operator-developers to build a portfolio of private pay, market rate, and next-generation, Senior Care Communities.

Benefit from a unique deal flow pipeline, including development, value add, and core opportunities.

Healthcare Real Estate is  a recession resistant, uncorrelated, low volatility U.S. real estate asset class. Traditionally access to these investment opportunities has had a high barrier of entry due to operator specialist and normally reserved to the largest institutional investors

 

Our vision is to create a program with high transparency and outcome predictability to provide healthcare professionals and family office investors access to a pipeline of multi owner vehicle opportunities.

 

Partner With An Existing Senior Care Fund

Leverage an existing industry defining private equity healthcare brand and the excess deal flow that comes w

While the diversification of a Fund investment structure has benefit from Limited (LP) and General Partners ( GP )  have expressed concerns about structural risk issues.

  • Low process transparency
  • Low final portfolio predictability
  • Long-term commitment lockups (8-10+ years)
  • Investors must rely upon GP investment strategies that are initiated after closing.
  • The J-Curve reduces overall investment returns.

We are a Pre-Defined Investment Program

Our Program has joint venture partners (JVPs) and has:

  • Predefined high-performance operators that will develop, build and manage our properties
  • Agreements that pre-define investment terms, velocities, property types, regions, unit mix and operating performance metrics – historical and forecast
  • Performance-based management fees — not a % of committed capital but rather a % of the capital that is invested or allocated to specific projects
  • No long-term commitment – JVPs have the first option but no obligation to fund future tranches.
  • A pre-negotiated, pre-committed, programmatic pathway to a predefined final portfolio.
  • Best-of-class transparency, predictability, and flexibility.
  • Multi-year Agreements with proven Preferred Operators**.
  • Alignment with our JVP
  • We fully underwrite each project in our Program for our Investment Committee’s approval.

Investment Structure Comparison – Investment Process Risk

Performance-Based Fees, Transparency, and Outcome Predictability

 

Portfolio Outcome Comparison – Our Program has no J-Curve

Programmatic Funding, Shorter Time to Exit

Key Portfolio Process Steps Comparison

Each Property Investment – 10 Common Steps to Closing

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We all now live in the COVID world.  Everything has changed.  Science indicates that the world will likely suffer more COVID-like pandemics this decade.  Economic and specific industry predictions have huge volatility.

The U.S. has the world’s lowest sovereign risk, largest free economy and deepest body of healthcare technologies.

For over 70 years, U.S. commercial real estate (USCRE) has created great investor wealth.  In 2018, USCRE value was ~$16T, about 50% of the world’s commercial real estate value.  Since 1971, U.S. REITs have returned ~170% of S&P returns.  But now, in the COVID world, NCRIEF NPI (NPI) sectors have volatile occupancies, rents and collections, with COVID and Non-COVID costs going up.

VISUALIZE THE SENIOR LIVING COMMUNITY (SLC) ASSET CLASS

The National Investment Center for Senior Housing & Care defines SLCs (also classified as Seniors Housing) as investment-grade market rate, private pay senior living communities with enriched services for residents. SLCs can have any mix of independent living (IL), assisted living (AL), and memory care (MC) residences. Nursing Homes and Post-Acute facilities are Not SLCs.

When analyzing investment-grade US Real Estate property types, it is highly rational for investors to ask:

  • What property type was the most recession-resistant in the Great Recession?
  • What property type has had the best total gross investor return performance since 2007?
  • What property type has the strongest demographics-driven unit demand growth forecast?

The ANSWER is The Senior Living Community Sector

The SLC Sector – Past & Future Best of Class U.S. Commercial Real Estate (USCRE) Performance

Since 2005, the SLC sector has delivered top performance versus the NPI and the Multi-Family sector:

  • Total Gross Investor Returns – ~430 bps higher than the NPI and ~460 bps higher than Multi-Family
  • Revenue Performance – highest growth rate, most predictable, lowest volatility and least correlated
  • Increasing Value per Profit $ – 10-year SLC cap rate decline to near Multi-Family, 5.9% vs 5.6% in Q419
  • In the Great Recession, Assisted Living occupancies were stable, averaging ~91% from 2007 to 2010

Allocate to The SLC Asset Class for Capital Safety

Great Recession Impact on Year over Year Asking Rent Volatility and Relative Rent Change 2007 – 2012

Source: NIC Map Data Service; Green Street Advisors. Base Year = 2007

Allocate to the SLC Asset Class for the: Lowest Volatility, Lowest Correlation, and Highest Investor Returns in USCRE

Volatility, Correlation &
2005 – 2019 Total Returns

Source: NIC, NCRIEF, NAREIT

Allocate to The SLC Asset Class for Performance

Performance History
and Forecast 2007 – 2025

Source: IBISWorld Reports, USCRE sectors based on revenues; S&P Index based on monthly closing prices. Base Year = 2007

Demographics Are Destiny

The largest SLC demographic wave in U.S. history has arrived – pushing a 20-year SLC Unit Demand Super Cycle.  The 20-year new SLC unit forecast is over 2 Million. The total existing U.S. SLC inventory is ~1.5 Million units.  Under 20% of the current SLC inventory is Pre-Boomer / Boomer designed and 0% is COVID designed.  Current inventory average age is ~20, yet the 20-year forecast assumes no current inventory SLC unit obsolescence.  New unit construction in 2020 will be the lowest in decades.  New SLCs have a strong competitive advantage.

Largest U.S. SLC Demographic Unit Demand Wave in History has Arrived

Demographic Wave & SLC Unit Demand Super Cycle

Source: Dent Demographic Service; US Census

A Surge in New SLC Unit Inventory is needed to meet the Largest SLC Demographic Wave in History

Annual SLC New Unit Demand

Source: ASHA/Senior Housing Analytics/Rockwood Pacific based on NIC Data

Preferred Operators are Essential to SLC Top Performance

Senior Living Communities (SLCs) are service delivery operating properties. Top performing operator – developers (our Preferred Operators) are essential to top quartile performance.

We have aligned with top performing Senior Housing operator-developers to build a portfolio of up to 30 new, private pay, market rate, next generation, SLCs with a total project cost of up to $1 Billion.

Our Preferred Operators

  • $5+ Billion assets under management
  • 350+ communities managed
  • 20,000+ employees
  • 15+ years average time in business
  • 50+ SLCs in their pipelines
  • Diversified throughout the U.S.

Why a Pre-Defined JV CO GP Investment Program

  • Pre-Closing Review of our proven Senior Living  operators, the Agreements and our terms-based, model IRR ranges
  • Performance-Based Program fees earned at property level funding – no J-Curve negative effect on IRR
  • No Long-Term Lockup – tranche funding with first option, not the obligation, to fund each new tranche

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