Harrison Focuses on Healthcare Facilities, Goes JV with Bickford Senior for $62M

In another sign of life for an up-and-down economy, especially in the healthcare sector, Bickford Senior Living and Harrison started a JV for six assisted-living facilities in a deal worth approximately $62 million.

July 15, 2011
By Nicholas Ziegler, News Editor

In another sign of life for an up-and-down economy, especially in the healthcare sector, Bickford Senior Living and Harrison Real Estate Capital have entered into a joint venture for six assisted-living facilities in a deal worth approximately $62 million. The majority of the equity came from Harrison Street Real Estate Partners III, L.P., which focuses on investing in the education, healthcare and storage segments of the real estate market. Calling the situation a win for both parties, Michael Gordon, senior vice president of Harrison, explained the JV’s targets.

“Our partnership will focus on leveraging Bickford’s existing platform to strategically increase its footprint within its current markets and expand into new markets, with an emphasis on quality and controlled growth,” he said.

According to a June report from Jones Lang LaSalle, the healthcare sector has seen more sluggish recovery than other areas due to three areas: surrounding healthcare reform, a constrained capital environment and intense cost-containment demands. But joint ventures such as the Harrison/Bickford endeavor are springing up, in part due to the increased liquidity of capital markets. The report goes on to note that “The main consolidation trend affecting healthcare real estate in the months to come will be a significant uptick in mergers as providers seek to capitalize on economies of scale and mitigate the impact of reduced rates of reimbursement.”

To that end, the partnership will work to acquire, develop, reposition and operate assisted-living and memory-care facilities throughout the Midwest, building on the portfolio of more than 2,000 Bickford-run centers.

“We have developed a strong relationship with Harrison Street,” said Michael Eby, President of Bickford Senior Living. “It is their overall philosophy, knowledge of the senior housing sector, partner focus and access to capital that led our decision to team with them.”