Sunrise Senior Living Ties Up Bay Area Assets

SAN FRANCISCO-Sunrise Senior Living Inc. has agreed to acquire the operating assets of three Bay Area continuing retirement communities. The three communities have annual revenues of approximately $10 million and capacity for more than 200 units. The total purchase price is $28 million. The transaction is expected to close in the next 45 days.

The properties include The Carlisle, a high-rise located on Cathedral Hill in San Francisco; The Stratford, located across from Central Park in San Mateo; and Webster House, located one mile from Stanford University. McLean, VA-based Sunrise says the 100% private pay properties are geographically clustered near Sunrise's other Bay Area communities.

A company source tells GlobeSt.com the deal includes the long-term management contracts for all three communities and ownership of one of the communities, Webster House. The two other communities are condominium developments owned by the residents. The seller of the property, the management contracts and the operating assets are Raiser Resources LLC and Raiser Senior Services LLC.

The $28-million purchase price includes an estimated $2 million in transaction and transition costs. Excluding one-time transaction and transition expenses, Sunrise estimates that the transaction will be break-even in 2006 and accretive thereafter. The company declined to provide additional information, such as the exact length of the management contracts and the value of the real estate that was acquired.

With the addition of these three new communities, Sunrise now manages 17 senior living communities in the Bay Area including San Francisco (2), San Mateo (2), Belmont (2), Palo Alto (2), Santa Rosa (2), Sunnyvale, Cupertino, San Jose, Oakland Hills, Danville, Walnut Creek and Petaluma. Worldwide, the company operates 422 communities with a capacity of 50,000 residents and has an additional 43 properties under construction that will have capacity for 6,000 residents.