$57M Luxury Treatment Center Trades in Sale Leaseback
The facility’s performance exceeded expectations from the beginning, even amid the pandemic.
CSMN Investments sold the All Points North Lodge, a comprehensive wellness and treatment campus located just outside of Vail, Col., to WC Acquisition Holdings in a $57 million sale-leaseback transaction.
All Points North Lodge, which officially opened in March 2020, provides a resource for those struggling with addiction, mental health and trauma. The five-star, resort-style campus, with more than 77,000 square feet of rentable space, recently completed more than $20 million in improvements in what used to be the Cordillera Lodge & Spa.
“He [the seller] bought the Cordillera Lodge, gutted it and completely redid it,” says Jonathan Hipp, principal and head of the Avison Young’s US Capital Markets Net Lease Group, which represented the CSMN.
Hipp tells GlobeSt.com that Avison Young initially brought the facility to market before it opened, but buyers wanted proof that the business was viable.
Even in the pandemic, Hipp says the facility’s performance exceeded expectations right out of the gate.
“The interest in terms of pricing increased dramatically [after it opened],” Hipp says. “People had proof of concept, and COVID was sidelining some other industries. This one had the wind at its back.”
WC Acquisition Holdings not only bought the property but also put money into the operating company. “Our seller felt like that was an alignment of interest,” Hipp says.
Hipp says interest was strong in All Points North Lodge because many investors are looking for alternative asset classes in their chase for yield. The facility offers addiction and mental health treatments, trauma therapy, crisis management, coaching and personal development workshops, concierge medicine, athletic performance programs and advanced practices and activities.
Investors may have shied away from these treatment centers in the past, but Hipp says attitudes are changing.
“It is something that probably had a little bit of a stereotype in the past,” Hipp says. “But people are starting to understand that it’s a real need and a real business. And if you can partner with the right operators, there is a lot of opportunity. It’s an interesting industry, and it’s going to continue to grow at a pretty rapid pace for the right operators.”
Joining Hipp on the deal from the Avison Young team were Richard Murphy, senior vice president; Stan Wyrwicz, senior vice president; and Rick Egitto, a principal in the firm’s Denver office.