VOL. 123 | NO. 79 | Tuesday, April 22, 2008
Real Estate & Development
Glenmary Apts. To Become Senior Facility
By Eric Smith
CHANGE OF PLANS: The Glenmary at Evergreen, at 1550 North Parkway in Midtown, will become an independent- and assisted-living senior housing facility and not the condos that Tacoma, Wash.-based Gintz Group had originally planned. The company also sold the former apartment complex for $19.5 million to Newport Beach, Calif.-based Nationwide Health Properties Inc. -- Photo By Eric Smith
The Glenmary at Evergreen has a new owner and a new purpose - again.
Tacoma, Wash.-based Gintz Group recently scrapped its original idea to convert the two-building, 172-unit Midtown apartment complex at 1550 North Parkway into condominiums and instead will turn it into an independent- and assisted-living senior housing facility, said Wade Lewis, project manager for the company's Memphis region.
Gintz Group also has sold the property for $19.5 million to Newport Beach, Calif.-based Nationwide Health Properties Inc., a publicly traded real estate investment trust (REIT) whose portfolio includes "senior housing facilities, long-term care facilities and medical office buildings throughout the United States," according to its Web site.
Under the new plan, Gintz Group will lease the property back from the new owner and contract with Portland, Ore.-based Paradigm Senior Living Inc. to manage the facility. Lewis said it will open in October and continue to be called Glenmary at Evergreen.
Going with the curve
The sale, which closed last week, included an 11-story tower formerly called Woodmont Towers as well as a two-story building formerly called Woodmont Gardens.
The larger building fronts North Parkway and the smaller building fronts Avalon Street on a 4.33-acre site near Rhodes College. In conjunction with the sale, the buyer and seller executed a quitclaim deed transferring the property.
Gintz, operating locally as 1550 North Parkway LLC, had owned the property for less than two years. In August 2006 it paid $10 million for the apartment complex with plans to turn it into condos.
But Gintz Group sold only seven units, and the housing slowdown forced company executives to reconsider.
"With the real estate market being what it is today, we weren't selling the condos and we realized the need to make a change," Lewis said. "We saw a growing need in the industry for senior living. Realizing that niche in the market, we feel like we can provide that service. We've done extensive market studies in the Memphis area, and there is definitely a need for this kind of property here. We think we've got a successful project going now."
More fruitful adaptation
Gintz was planning to convert the building into 149 condo units and had completed 42 of them before deciding to shift gears. The finished condos will now become part of the independent-living portion with only minor changes needed, including interior finishes, hand rails in the bathrooms and some panic call systems.
Also, Gintz is hiring two companies to design unfinished units, a media room, an arts and crafts area, a full-service kitchen and a dining room, all of which will be specific to senior living needs.
The construction budget for Glenmary at Evergreen is now $8.3 million, Lewis said, marking a $2.5 million to $3 million increase over what Gintz Group planned to invest in the condo conversion.
Paradigm president Lee Cory said the property's main building will house 123 independent-living units and 52 assisted-living units, while the smaller building, likely to be called the "Gardens," will have 28 assisted-living units that may be designated as specialty care for people with unique needs and additional supervision.
Entre to the market
Cory said Glenmary at Evergreen is the Paradigm's first property in Memphis, but the company has worked with Gintz Group before. He said the timing and the location of this project were ideal for entering the area.
"The building and the neighborhood lent themselves perfectly to this use," Cory said. "The market is underserved as far as we can tell, and it seemed that the area could use a high-quality option for both independent- and assisted-living."
While the condo and single-family housing market has slumped, Cory has seen demand for senior living increase. The company studied the area carefully, even looking at other parts of town, before deciding to move forward with this property.
"There seemed to be a lot of folks in Midtown that wanted to stay in Midtown and not move out to other parts of the city or region," Cory said. "There seems to be a real identity in that neighborhood and that part of town, and I think this is going to be a wonderful opportunity to make that happen for people."
At full occupancy, Glenmary at Evergreen will employ 55-70 people depending on how many services the residents require, Cory said. Paradigm will begin hiring within the next six months and the startup work force should be in place a month prior to the Oct. 1 opening.
Research analyst Kate Simone contributed to this report.