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|Like grandpa's ear hair, seniors housing is growing. It's one of the few CRE asset classes that is, ARA National Seniors Housing Group's Scott Corbin tells us. Compared with '09, sales volume has spiked (just like said grandpa's blood pressure after glimpsing Betty Grable's gams).|
|ARA's Ryan Maconachy (right, with Scott) anticipates more development this year. âWe're seeing some initial fundings and groundbreakings," he says. They've also seen cap rates stabilize with a sizeable drop over last 120 days. (Cap rates fell significantly in Q1 but he predicts even more in Q2.) REITs have come back into play in a big way and are ready to spend money again, they say, causing private equity groups to resume as well.|
|One of Ryan and Scott's recent sales is the Village of Stone Brooke in McKinney. The independent living facility was built in 2006 by a multifamily developer trying his first seniors deal. His downfall: He didn't install a large commercial kitchen, key to the asset type, Ryan says. The deal was a foreclosure that ARA sold on behalf of Muni Mae Financial. Ryan adds that he's seeing a bit of crossover from multifamily developers moving into seniors housings (not literally, but give it a few years). The most successful ones have partnered with experienced seniors operators to run their properties.|
|What about construction? Ryan anticipates more development this year as banks loosen their purse strings, though only the best construction deals are getting through. From 4Q '09 to 1Q '10, Ryan notes that four of the most active seniors living development markets are Chicago, New York City, Dallas, and Houston. (All markets Bisnow covers. Coincidence?) Dallas-Fort Worth leads the pack with 1,494 total units, followed by the Windy City with 1,302 under construction (689 independent living, 321 assisted living, and 292 skilled nursing facilities). The Big Apple is next with 1,056 units (831 IL, 120 AL and 105 SNF), while Houston rounds out the leaders with 591 total units under construction (see chart).|