DALLAS - Sonida Senior Living, Inc. (NYSE: SNDA), a prominent senior community operator, has recently completed the acquisition of eight senior living communities in the Southeast for $103 million, and entered into an agreement to acquire two additional communities in Atlanta, GA for $29 million. These transactions have increased Sonida's year-to-date acquired properties to 17 and expanded its operating portfolio to 91 communities.
On October 1, 2024, Sonida finalized the purchase of eight communities in Florida and South Carolina, which are expected to enhance the company's presence in the Southeast. The acquired properties, with an average asset age of five years, consist of 555 units offering Assisted Living and Memory Care services. The purchase price reflects a significant discount to Sonida's estimate of replacement cost, with an in-place occupancy of approximately 85% and an average revenue per occupied room (RevPOR) of over $6,000.
The agreement to acquire two Atlanta-based properties adds 178 units to Sonida's portfolio and is consistent with the company's strategy for regional densification. The Atlanta acquisition is expected to be funded through cash on hand and proceeds from Sonida's senior secured revolving credit facility.
Furthermore, on October 3, 2024, Sonida closed an additional $75 million commitment on its senior secured revolving credit facility, bringing the total capacity to $150 million. This credit facility, originally entered with BMO Bank N.A. and expanded with the Royal Bank of Canada, has a term of three years and is fully recourse to Sonida and its subsidiaries.
The company's capital markets activity and acquisitions are part of a growth strategy aimed at capitalizing on favorable trends in the senior housing market. Sonida's President and CEO, Brandon Ribar, expressed confidence in the company's investment pipeline and the transaction environment.
The forward-looking statements in this press release are subject to risks and uncertainties that could affect the company's actual results. These include, but are not limited to, the company's ability to realize the anticipated benefits of the acquisitions and the impact of the acquisitions on its business.
Sonida Senior Living, Inc., based in Dallas, Texas, owns, operates, and invests in senior living communities, offering services and care for senior adults in 91 housing communities across 20 states.
This news article is based on a press release statement.
In other recent news, Sonida Senior Living has demonstrated a significant push towards expansion and operational efficiency. The company announced a public offering of 4 million shares, with the proceeds expected to fund the acquisition of eight senior living communities and other corporate purposes. The offering is managed by Morgan Stanley, RBC Capital Markets, and BMO Capital Markets.
Further, Sonida plans to acquire eight senior living communities in the Southeast United States, adding 555 units to its portfolio. This move is part of the company's growth strategy, aiming to enhance its presence in high-growth metropolitan areas. The acquisition is expected to be accretive once the net operating income margin stabilizes over the coming years.
Sonida also reported strong financial results for the second quarter of 2024, with an average occupancy rate of 86.2% in its same-store owned portfolio and operating margins surpassing 28% for the quarter. Furthermore, a year-over-year rate growth of 8.4% was observed. These developments underline a period of growth and operational efficiency for Sonida Senior Living.
InvestingPro Insights
As Sonida Senior Living (NYSE: SNDA) expands its portfolio with recent acquisitions, InvestingPro data provides additional context to the company's financial position and market performance.
The company's market capitalization stands at $486.21 million, reflecting its recent growth initiatives. Sonida's revenue for the last twelve months as of Q2 2024 was $244.78 million, with a notable revenue growth of 10.46% over the same period. This growth aligns with the company's aggressive acquisition strategy outlined in the article.
InvestingPro Tips highlight some important aspects of Sonida's financial health. One tip notes that the company "operates with a significant debt burden," which is relevant given the recent $75 million expansion of its revolving credit facility to fund acquisitions. Another tip indicates that Sonida is "not profitable over the last twelve months," with an operating income margin of -4.62% for the last twelve months as of Q2 2024.
Despite these challenges, an InvestingPro Tip points out that Sonida has seen a "high return over the last year," which is corroborated by the impressive year-to-date price total return of 174.32%. This substantial return suggests that investors are optimistic about the company's growth strategy and recent acquisitions.
For readers interested in a more comprehensive analysis, InvestingPro offers 7 additional tips for Sonida Senior Living, providing deeper insights into the company's financial position and market performance.
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