These communities were purchased in a sizeable portfolio transaction pre-COVID, under a value-add thesis contemplating operator transitions to create regional groupings coupled with the intent to meaningfully invest in renovations and repositioning.

Unfortunately, the cumulative impact of COVID followed by an unprecedented rise in interest rates created meaningful headwinds to the original thesis and drove a portfolio re-prioritization, rationalization, and de-levering effort.

The California portfolio consisted of a 1986 vintage, 157-unit AL community in Corona and a 1998 vintage, 101-unit AL/MC community in Roseville. While performance varied between the communities, neither was performing and the seller elected to strategically divest and de-lever rather than reposition the communities and re-set their investment horizon.

Given disparate and nuanced asset profiles, Blueprint ran a broad marketing process targeting both private-pay and waiver focused California owner/operators and private investors who could leverage an attractive basis to re-position the assets. After receiving multiple bids from a diverse cross section of established industry players, the seller ultimately selected Sunny Hills Management Co as a portfolio buyer.

The transaction closed efficiently and timely.