PRESCOTT, AZ-Five Star Quality Care Inc. has expanded its footprint in Arizona, buying a 116-unit senior housing community here for $25.6 million. The property, Granite Gate, is located in the picturesque Granite Dells and was previously a luxury resort.
Five Star Quality Care, an assisted living operator based in Newton, MA, was one of several organizations that were interested in buying Granite Gate, according to Ryan Maconachy, a senior housing specialist with ARA. He and Chad Lavender represented the seller, Utah-based Granite Gate Retirement Community LLC.
“Five Star Quality Care has five other assets in Arizona, and those assets are definitely higher end,” Maconachy notes. “Granite Gate fit nicely in their portfolio.”
Maconachy tells GlobeSt.com that Granite Gate garnered interest from senior housing owners and operators, as well as REITs and institutional investors. The team brought the property to market without a list price, allowing the market to set the pricing. “The final offers were within $200,000 of one another,” he notes, adding that the property sold for $220,689 per unit. “This is definitely a unique property, and it achieved a very strong price for its location.”
Built in 1996 and renovated in 2006, Granite Gate consists of 91 independent and assisted living units and 25 memory care units. The community has traditionally maintained a historical occupancy well above 90% and had an occupancy rate in the upper 90% range at the time of closing.
“The buyer is a long-term holder, and they like the idea that the property is a stable asset,” Maconachy says.
Additionally, Maconachy notes that it offers potential upside. “The property is licensed for 124 beds, and right now, there are only 91 existing beds, so the new owner could create some upside by expanding,” he points out. The four-story community is situated on 7.34 acres, and the sale also included an additional 13.6 acres that could accommodate another building.
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