Half-empty senior housing complex presents challenge to new owner

Talk about undertaking a challenge and minimizing the extent of it.

That’s the situation for Eden Senior Care, the Skokie, Illinois, senior housing provider that is the new owner of Maple Ridge Senior Living, a senior housing community at 35300 Kaiser Court, Willoughby.

Mordy Polstein, Eden chief operating officer, said in a phone interview that the company was attracted by the opportunity at the Willoughby property and sees it as the beginning of an entry into the Ohio senior-care market.

“We’re very excited about the Willoughby property,” Polstein said. “We see this as a charming foray into Ohio, as we are strong in the Midwest. It’s a different kind of property. It has a home-like environment for residents.”

Typically, current senior housing projects consist of a single multistory building for operating efficiencies. By contrast, the Willoughby property, an early entry in the for-profit senior housing sector predicated on the use of low-income tax credits, consists of seven one-floor buildings, with a total of 90 units.

And there’s the opportunity. And the challenge.

Polstein said Maple Ridge has 40 empty suites. So it provides the opportunity to dramatically improve operations.

“One thing we immediately do is stabilize buildings that need tender loving care,” Polstein said. “We now have enough spit and manpower to put boots on the ground and be very engaged in the community. We are not a ‘manage from afar company.’ That is a strategy for disaster.”

Among those executives giving the property attention is Eden’s dedicated marketing staff, charged with promoting the property. Polstein said he did not know how many other bidders there were for the complex he called a project for a “financial turnaround.”

Through Willoughby AL Realty LLC, Eden has owned the property since shelling out $4.84 million for it June 7, according to Lake County land records.

The seller was an affiliate of Blackstone (NYSE: BX), which had acquired complex for $4.3 million in 2017. The purchase was part of a $745 million portfolio transaction by the private equity concern, according to Senior Housing News at the time.

The sale by Blackstone follows a period when senior housing properties were roiled by COVID-19 and draconian preventive measures such as a statewide lockdown.

The market as a whole has since recovered marginally. However, Northeast Ohio had an occupancy rate of 76%, compared with 81% nationally as of the end of the first quarter of 2022, according to The National Investment Center for Seniors Housing & Care (NIC), a Bethesda, Maryland, trade group.

The region still ranks among the lowest five areas in occupancy nationally, primarily due to rapid building of properties serving the sector that opened just as COVID-19 hit. The pandemic was particularly virulent for older people and often kept them and their loved ones from considering supportive housing options as the necessity for them arose.

Blackstone real estate spokespersons have not returned calls and an email query about the deal since Monday, June 13.

Maple Ridge, which dates from 1999, is Eden’s 10th assisted living community. It also operates 16 skilled nursing homes. Most of its holdings are in Wisconsin and Minnesota, despite the owner’s headquarters near Chicago.

Eden did not return Crain’s Cleveland Business calls and emails before a report on the sale was posted Monday, June 13, on the Crain website.