Trilogy Health Services will continue to focus on developing continuing care retirement communities in the Midwest as it is acquired in a $1.125 billion joint venture with Griffin-American Healthcare REIT III and NorthStar Healthcare Income, Trilogy founder and CEO Randy Bufford tells McKnight’s Senior Living.
In its 18 years of existence, Louisville, KY-based Trilogy has grown to encompass 96 senior living communities with a total of 10,000 beds in four states—Indiana, Kentucky, Michigan and Ohio—and Bufford says the company’s integrated approach “fits very, very well for where the industry is at this point in time as far as consumers selecting different levels of services.”
Trilogy plans to open 10 communities—eight new ones and two replacements—in 2016, Bufford says. “The pipeline is pretty full, and there are a lot of business opportunities to do what we do right here in the Midwest,” he says.
Griffin-American will own 70% of the joint venture and will act as its manager. NorthStar Healthcare Income, a public, non-traded real estate investment trust, will own 30% of the joint venture. Trilogy’s management team, led by Bufford, will maintain an investment of about $24 million in Trilogy.
Bufford says that Trilogy’s investors began looking to “exit their investment” last fall to realize a return after seven years. Griffin-American and NorthStar “seemed like the right fit for us because we were looking for somebody who not only wanted to make an investment in our organization but understood our values and our mission and where we’re headed,” he adds.
The transaction will almost double the size of Griffin-American, according to Jeff Hanson, Griffin-American’s chairman and CEO and one of its largest stockholders. He calls the investment “transformational” and praises Bufford and Trilogy’s executive team.
Ron J. Jeanneault, CEO and president of NorthStar Healthcare, also says he is impressed with the company. “Trilogy’s properties have a low average age, strong occupancy rates and a high-quality mix which, coupled with their robust development pipeline, creates an exciting addition to our portfolio that will continue to grow over time,” he says.
Trilogy also owns an institutional pharmacy (PCA Pharmacy), which has four locations, and a rehabilitative services company, Paragon Rehabilitation. Overall, the company employs more than 13,500 people.