NEW YORK — H2C Securities Inc. (“H2C”), a healthcare-focused strategic advisory firm, served as the exclusive advisor to AM Behavioral Health, LLC, a joint venture between the principals of Meridian Senior Living, LLC and Midwest Behavioral Management, LLC (“Sponsorship”), to secure equity and debt for the conversion of a senior living community to a 96-bed behavioral healthcare facility (the “Facility”) in the Dayton, Ohio, market.

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Director Matthew Tarpley and Senior Associate Michael Fioravanti led the transaction for H2C.

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The Facility will feature distinct wings to allow for three modalities of care: (1) 36 memory care beds for patients with Alzheimer’s disease or dementia exhibiting violent and/or aggressive behavior, (2) 20 inpatient beds for geriatric psychiatric care, and (3) 40 beds for general behavioral health and psychiatric residential-based treatment. In addition, the Facility will allow for intensive outpatient psychiatric care and counseling for patients integrating out of the residential setting.

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The Property is poised to address a significant unmet demand for behavioral health in the Dayton area and will likely attract patients from a +50-mile radius, with most residents coming from within 20 miles given the lack of options present in the market.

Upon completion, which is scheduled for mid-2023, the hospital will be managed by Midwest Behavioral Management, LLC, a new management company created to focus on the conversion of senior housing communities to behavioral health facilities.

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The joint-venture equity will be provided by a Texas-based real estate private equity firm with a demonstrated track record in the healthcare sector, and the financing will be provided by an Ohio-based bank with a presence across four states.

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"H2C was a critical partner in our efforts to capitalize this project. They were able to help us find the right financial partners to support the construction and operational evolution." said Robert Sweet, co-CEO of AM Behavioral Health, LLC.

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Notably, the transaction represents one of several behavioral health joint ventures between health systems and specialty operators—both real estate and M&A—that H2C has led over the past 24 months. This is a space in which H2C has developed a true expertise.

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“Tim and his team identified a significant unmet demand for behavioral healthcare offerings in Dayton and carefully selected a best-in-class operating partner to execute the vision,” said Matthew Tarpley, Director at H2C. “Behavioral health is a rapidly growing segment of healthcare real estate, and Sponsorship partnered with capital sources that have an aligned vision for this sector and the ultimate success of the Facility.” Email Matthew.
 

“We had an inherent belief in the success of the redevelopment and therefore were able to effectively communicate the story to prospective partners and lenders, ultimately securing the financing from an Ohio-based bank and an equity partner that will be a resource to our client beyond just this transaction,” said Michael Fioravanti, Senior Associate at H2C. Email Michael.