A $500 Million Maryland Nursing Home Deal Is Quietly Changing Hands — 18 CommuniCare Properties Are Going to a Florida-and-Texas Buyer

Baltimore, Maryland — A portfolio of 18 nursing homes operated by CommuniCare is changing hands in a $500 million deal that ranks as one of the largest eldercare sales in Maryland in the past decade.

According to industry reports, the buyer is a group of family trusts led by Jack Shelby, a businessman who already owns nursing homes in Florida and Texas. Ten of the Maryland properties sit in the Greater Baltimore area. The rest are spread across the Washington, D.C. suburbs, Western Maryland, and the state’s Eastern Shore.

The Maryland Health Care Commission cleared the transaction back in March. Final property sales are still working their way through the state’s records, and not all transactions have been posted yet.

A new operator takes the helm

Shelby and the other buyers plan to hand day-to-day operations to Hallmark Health Consulting Services, along with a related D.C.-based firm called Health Consulting Services. Ownership of the real estate and operational rights are being split among different combinations of Shelby family trusts.

Representatives for Omega Healthcare Investors, CommuniCare, and Shelby did not respond to media inquiries when contacted, according to industry sources.

CommuniCare, based in Ohio, is the country’s eighth-largest nursing home operator with 122 facilities across six states. Most residents at the Maryland properties rely on Medicaid for their care, the report said.

Quality ratings sit below average

The 18 facilities carried an average CMS five-star rating of 2.38, which falls under the 3-star national average. That’s part of why the state is paying close attention. Maryland law requires companies that buy nursing homes to submit detailed financial metrics and other operational data for three years after a deal closes, giving regulators a longer window to track what happens once new owners take over.

Echoes of a bigger Omega deal

Back in April, Omega Healthcare Investors told investors a CommuniCare portfolio worth $480 million was set to sell in the second quarter. That deal covered properties in both West Virginia and Maryland. How much overlap exists between Omega’s announcement and the Shelby transaction isn’t clear yet.

The pace of these large portfolio sales has picked up across the sector. Earlier this month, Omega’s REIT peer NHI signaled it could continue offloading assets after a $560 million skilled nursing portfolio sale, and several other operators are quietly shopping facilities as occupancy slowly climbs back from pandemic lows.

For Maryland’s nursing home residents, the change in ownership is mostly a paperwork shift. The buildings stay open. The staff, in most cases, stays put. But the financial structure behind those buildings looks very different than it did a year ago, and that’s the kind of shift that tends to ripple through care quality, staffing decisions, and Medicaid contracting in the months that follow.

The state will be watching.