The Post and Courier, Charleston, S.C., John McDermott column
Aug 22, 2011 (Menafn - The Post and Courier - McClatchy-Tribune Information Services via COMTEX) --The owner of three local housing developments for elderly residents is cashing out to focus its attention on the rebounding apartment business.
Greensboro, N.C.-based Bell Partners Inc. has announced it is selling nearly all of its senior-living portfolio for more than 300 million to Senior Housing Properties Trust of Newton, Mass. The 22-property deal includes The Palms of Mount Pleasant, Ashley River Plantation in Charleston and Summit Place on Daniel Island. Prices for individual communities were not available last week.
"The sale of the senior living communities is a key part of a Bell Partners' strategic shift over the last 18 months, as Bell focuses on its position as one of the country's leading apartment ownership and management companies," the seller said.
Bell entered the senior market in Charleston in 2006 when it paid 10.45 million for what is now Ashley River Plantation. Later that year, it snapped up Cooper Hall and the nearby Savannah Grace, both of which were combined to form The Palms in a deal valued at 27.5 million. It then bought Summit Place, then called Spring Arbor, in 2008 for about 6.7 million.
Bell's exit from the senior-living business was prescient: The sale preceded the announcement that Medicare would reduce reimbursement rates to skilled-nursing properties by about 11 percent over the next fiscal year starting in October. The cuts are in response to unexpected increases in nursing-home payments. The move hammered the stocks of publicly traded companies in the business, including Senior Housing Properties Trust.
The new owner controls about 3.8 billion worth of primarily senior living properties with 27,000 units in 36 states.
David Hegarty, president and chief operating of Senior Housing Properties Trust, said he does not "expect any significant changes to the operations" to the local acquisitions, adding that "maybe over the course of time, the operations will be enhanced with more service options." Management is being handled by Five Star Senior Living, part of Five Star Quality Care Inc.
Hegarty noted that Summit Place had been financed with federal money and its sale requires approval from the U.S. Department of Housing & Urban Development.
As for Bell Partners, it's still a player in the local real estate market through its three apartment complexes: Ashley Grove in Charleston, Audubon Park in Hanahan and Northwoods Townhomes in North Charleston.
The ownership of one of the area's two Dick's Sporting Goods stores is in play.
A national real investor has cut a deal to buy the building that houses the chain's Charleston location this month for 7.5 million, according to a filing with the Securities and Exchange Commission.
The purchaser, Cole Credit Property Trust III, is an affiliate of Phoenix-based Cole Real Estate Investments, which has a portfolio of 1,350 income-producing properties. Dick's opened the 45,000-square-foot store on Orleans Road near Citadel Mall in 2005. The building generates an annual base rent of 641,250, or 14.25 a foot. That would give the buyer a 8.55 percent return, or "cap" rate.
Cole Credit says on its website that it invests in "necessity retail" properties, calling itself "The Landlord of Where America Shops."
"Necessity retail properties include pharmacies, home improvement stores, national superstores, restaurants, and regional retailers," the company said.
Cole Real Estate and its affiliates own about 40 South Carolina properties, including the HH Gregg outlet on Rivers Avenue in North Charleston and numerous local convenience stores. About three months ago, the company forked out about 9.2 million for the Bi-Lo at Shelmore shopping center in Mount Pleasant.
Reach John McDermott at 937-5572.
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