Waukesha-based Covenant Communities Inc., a nonprofit focused on providing affordable housing, plans to acquire 14 properties operated by Waukseha-based Capri Senior Communities.
[caption id="attachment_325429" align="alignright" width="391"] James Tarantino, founder of Capri Senior Communities[/caption]
The Wisconsin Health & Educational Facilities Authority board this week approved a resolution from Covenant Communities seeking up to $189 million in bond financing for the purchase of the properties, said Dennis Reilly, executive director of WHEFA.
Covenant Communities chair Glen Choban, a former executive with Capri Senior Communities who continues to work with the company on a contract basis since retiring last year, said the cost of purchasing the properties will likely come in under $189 million, but the financing provides flexibility.
Jim Tarantino, founder and principal of Capri Senior Communities, has a majority ownership interest in each of the properties, Choban said.
The facilities are located on nine Capri campuses across Wisconsin, including Milwaukee, Kenosha, Germantown, Sturtevant, Waukesha, West Allis, Whitewater, Fond Du Lac and Sun Prairie. Covenant Communities plans to execute a management agreement with Capri to continue operating the facilities.
Covenant Communities formed several years ago with a focus on providing low-income housing. The acquisition of these properties will set the facilities up for long-term success, Choban said.
“The missions of Covenant and Capri line up pretty well - a desire to provide affordable housing," he said. "There is always going to be a component of affordable housing within the overall projects … It allows us to continue serving that segment of the population that can’t afford services that they need.”
Choban expects the transactions will close at the end of July.
He said the properties are in good condition and will not require significant improvements in the near future.
“There was extensive work done on looking at property condition and, in terms of the scope of the transaction, there are relatively minor things that need to be done," Choban said. "Over the long term, there will be improvements that will be continue to be made, but nothing substantive immediately.”