Demand For Senior Housing Ticks Up As Sector Continues COVID Recovery

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Demand for senior housing properties began recovering this quarter as vacancies dropped nationally and rent growth picked up across all four major care types.

According to a new report from Moody’s, Q2 vacancy for the asset class came in at 16.9%, still worse than the pre-COVID five-year average but 10 basis points below the peak of 17% earlier this year.

“It may be too early to say the stress has bottomed out, especially given the recent resurgence of the virus, but second quarter data did prompt a bit of optimism for the senior housing sector,” Moody’s economist Lu Chen writes, noting that the second quarter vacancy rate for independent living, memory care, and assisted living facilities all declined between 10 and 30 basis points, while the vacancy rate for skilled nursing properties remained flat.

Memory care facilities, which have been hardest hit by the pandemic, showed a vacancy decrease of 8.8%, ending the quarter at 19.9%. Assisted living and skilled nursing facilities vacancies ticked up 6.9% over the same period to 18.2% and 16.5% respectively, while the vacancy rate at independent living facilities ticked up 6.1% from 9.5% pre-pandemic to 15.9% in the second quarter of this year.

Rent growth has softened year-over-year, Chen says, since most senior housing properties post rent changes at the beginning of the year, but Moody’s data suggests that rent growth picked up across all care types. The assisted living sector posted the fastest year-over-year rent growth, followed by independent living facilities.

Meanwhile, net absorption increased into positive terrain for the first time since 2020. Memory care is back to Q1 2020 levels, while skilled nursing showed the biggest gains with 8,000 units absorbed so far this year.

“As a result of the weakness in sector fundamentals since the public health crisis, extended slowdown of new facilities coming to market is consistent with the increase in investor’s caution for senior housing,” Chen writes.

Moody’s is “cautiously optimistic” in its outlook for the sector, Chen says, citing Centers for Medicare and Medicaid Service data indicating that more than 83% of the nursing home residents are fully vaccinated. However, he notes just 26% of nursing home facilities across the US have hit the industry target of vaccinating 75% of their staff.

“Low vaccine rates among staff and residents in states such as Florida leaves the senior housing industry more vulnerable to the resurgence of the virus. Starting in the first week of July, there has been a noticeable uptick of confirmed cases among senior housing residents and staff,” Chen says. “With new mask and vaccination mandates starting to take place in many places, we will closely monitor how that’s shaping the industry demand and supply in the coming months.”

An analysis from JLL earlier this spring indicated the need to serve the middle-income population will increase, leading to opportunities for investors.

“Investors remain bullish on seniors housing and care investments,” said JLL Managing Director Zach Bowyer, MAI, head of Alternatives Asset Sectors, Valuation Advisory. “We anticipate market fundamentals to steadily improve and the market to re-stabilize between two and four years, depending on the location.”

 

Source: GlobeSt.

IVX Health, National Provider Of Outpatient Infusion Centers, Secures $100 Million Growth Investment To Accelerate New Market Expansion

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IVX Health, a national provider of outpatient infusion centers, announcedt the completion of a $100 million Series F minority investment from Great Hill Partners, a private equity firm that invests in high-growth, disruptive companies.

Great Hill joins IVX Health’s existing investors including Linden Structured Capital, McKesson Ventures, Health Velocity Capital, and Nueterra Capital.

IVX Health offers an alternative to hospital-based infusion and injection services, transforming the patient experience by providing a superior level of service in a cost-effective, convenient site of care. Its local centers offer guaranteed private suites, large flat screen TVs, high-speed Wi-Fi, leather recliners with chairs for guests, and flexible, on-demand scheduling, including evening and weekend appointments.

Operating over 50 infusion centers across 16 markets, IVX Health will immediately utilize the funding to accelerate entry into new markets in 2022 and beyond as it seeks to fulfill its vision of becoming the nation’s preferred destination of pharmaceutical care for patients with complex chronic conditions such as multiple sclerosis, Crohn’s disease, and rheumatoid arthritis, among others.

“Our primary goal has always been to provide world-class service and clinical excellence to the patients we serve,” said Doug Ghertner, CEO of IVX Health. “IVX and Great Hill both see an inflection point in infusion therapy, as the growth in diagnosed autoimmune conditions and trends toward patient choice have aligned with an uptick in innovative new therapies. Many patients are unfortunately still left with few options for receiving this life-changing care, often within a crowded infusion room of a hospital – and that’s where we come in. We are confident that Great Hill’s investment and deep domain expertise will help us address this shortage of care options by enabling IVX to bring our unique clinical model and patient-centered amenities to an even broader universe of patients.”

“IVX Health is disrupting a distinct and rapidly growing healthcare vertical – biologic infusion and injection therapy – in unique ways that are driving tangible efficiencies for the U.S. healthcare system as a whole,” said Mark Taber, a Managing Director at Great Hill Partners. “We are excited to play a strategic, supporting role in fueling IVX Health’s next phase of growth as it enters new markets and collaborates with other providers in the healthcare ecosystem to drive value while continuing to redefine the care experience for its patients and referring providers.”

In connection with the investment, Taber will join IVX Health’s Board of Directors. Taber brings decades of executive healthcare experience from his time as Managing Director at Great Hill and as a board member of various portfolio companies.

In addition to IVX Health, Great Hill’s portfolio of healthcare companies includes: RxBenefits, Quantum Health, Labor First, ParetoHealth, and Vatica Health. The announcement deepens Great Hill’s experience partnering with innovative healthcare companies to help them pursue their full potential, which includes the recently-sold company, PartsSource, a leading provider of medical parts and supplies procurement solutions for hospitals, outpatient clinics, and physician offices.

IVX Health’s capital raise builds on what has already been a banner year for the company, as it has achieved record milestones for opening new centers, caring for new patients, and entering new states. IVX Health was also named to the prestigious Modern Healthcare Best Places to Work list for a third consecutive year. The organization continues to maintain an industry-leading 97 Net Promoter Score from its patient population.

Evercore served as financial advisor to IVX Health and TripleTree, LLC served as financial advisor to Great Hill.

About IVX Health

IVX Health is a national provider of infusion and injection therapy for those with complex chronic conditions such as rheumatoid arthritis, Crohn’s disease, multiple sclerosis and other conditions.

IVX Health’s national footprint of outpatient infusion centers are conveniently located in the communities where patients live and work. IVX Health’s experience-first model includes amenities such as flexible appointment scheduling with evening and weekend availability, guaranteed private suites, high-speed Wi-Fi, flat screen TVs with streaming TV and movies, and comfortable recliners with room for guests. For more information on IVX Health and its existing locations, visit www.ivxhealth.com.

About Great Hill Partners

Great Hill Partners is a Boston-based private equity firm targeting investments of $25 million to $500 million in high-growth companies across the software, digital commerce, financial technology, healthcare, and digital infrastructure sectors. Over the past two decades, Great Hill has raised nearly $8 billion of commitments and invested in more than 75 companies, establishing an extensive track record of building long-term partnerships with entrepreneurs and providing flexible resources to help middle-market companies scale. For more information, including a list of all Great Hill investments, visit www.greathillpartners.com.

 

Source: businesswire

World’s Largest Life Science Campus Launches In Texas

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Texas Medical Center has begun construction on the $1.8 billion first phase of the 37-acre megaproject.

Houston’s place in the U.S. and the world as a major life science cluster takes a big step forward as Texas Medical Center begins construction of the $1.8 billion first phase of a 37-acre, 6 million-square-foot life science campus known as TMC3.

Dubbed the world’s largest life science campus, the TMC3 master plan was designed by Boston-based Elkus Manfredi Architects, a key player in shaping several of the leading life sciences clusters in Massachusetts.

The TMC3 project expands on the more than 60 institutions and 100,000-plus employees already located at Texas Medical Center, the largest medical center in the world. William McKeon, TMC president & CEO, said in a prepared statement TMC3 extends the medical center’s collaboration to Fortune 100 life sciences companies and entrepreneurial ventures.

Phase One is backed by $1.8 billion in financing from leading life science investment and property development teams. It includes two buildings totaling 950,000 square feet—a 700,000-square-foot research facility and a 250,000-square-foot collaborative building developed by Beacon Capital Partners and their strategic partner Braidwell, a life science-focused investment firm.

The initial phase will also feature a hotel with more than 500 keys and 65,000 square feet of conference space; a 350-unit residential tower; more than 2,000 parking spaces and 18.7 acres of public space. Helix Gardens, part of the landscape design by Mikyoung Kim, will feature a chain of five public parks and a central garden for outdoor receptions, concerts, graduations and other large-scale events.

A Promising Future

Alex Karnal, co-founder & chief investment officer at Braidwell, said in a prepared statement TMC3 will be a model of how to empower an ecosystem of expertise at tremendous scale. In addition to its partnership with Beacon, Braidwell is expected to bring its expertise in making multi-stage life science investments to fuel growth of companies that will be operating on the TMC3 campus.

Noting it’s an unprecedented time for life sciences and innovation in the U.S., Steve Purpura, president of life science at Beacon Capital Partners, said in prepared remarks Houston has all the factors required for explosive growth in the life sciences space. He also credited TMC with seeding innovation, building relationships with the world’s largest life sciences companies and creating the infrastructure needed for long-term success.

TMC3 is expected to generate about $5.4 billion in economic growth for the state each year, including the creation of more than 23,000 new permanent jobs and about 19,000 construction jobs.

Other TMC3 campus collaborators include Majestic Realty, Transwestern Development, The University of Texas MD Anderson Cancer Center, Texas A&M University Health Science Center and University of Texas Health Science Center at Houston.

Another Houston Project

In February, Hines and 2ML Real Estate Interests released renderings of the 53-acre life science district in Houston known as Levit Green that will be adjacent to the Texas Medical Center. The mixed-use development’s first phase will include a 270,000 square-foot laboratory and office building as the centerpiece. The five-story building will include a 7,000-square-foot conference center; 5,800-square-foot fitness facility; café and restaurant space and an outdoor garden. Levit Green will eventually have more office components as well as residential, retail and hospitality space.