Citadel Care Centers Expands Florida Footprint with Strategic $30M Acquisition
In a significant real estate transaction that underscores the robust demand for senior living facilities in South Florida, controversial industry figure Leo Friedman has expanded his healthcare empire with the $30 million purchase of Abbey Delray, a comprehensive senior living campus in Delray Beach.
Friedman, the founder and CEO of New York-based Citadel Care Centers, finalized the acquisition of the 472-unit facility located at 2000 Lowson Boulevard from Dallas-headquartered Lifespace Communities, according to property records and real estate database Vizzda. The transaction was supported by substantial financing, including a $42 million loan from Metropolitan Commercial Bank complemented by $8.3 million in mezzanine financing provided by Northwind Group.
The multi-million dollar acquisition positions Citadel Care Centers as an emerging player in Florida's lucrative senior housing market, marking a strategic southward expansion from its primarily New York-centered portfolio.
Inside Abbey Delray's Comprehensive Senior Living Campus
Established in 1979-1980, Abbey Delray represents a comprehensive approach to senior care with its sprawling 25.7-acre campus. The property features an architectural mix of six three-story structures and nine single-story buildings thoughtfully designed to create a communal yet comfortable living environment.
The facility exemplifies the concept of a Continuous Care Retirement Community (CCRC), offering residents a complete spectrum of living arrangements and healthcare services tailored to address evolving needs as they age. The complex comprises:
- A 327-bed independent living center where active seniors maintain autonomy while enjoying community amenities
- A 48-bed assisted living section providing personalized support with daily activities
- A specialized 120-bed nursing care center offering round-the-clock professional medical attention
- A dedicated 30-bed memory care unit designed specifically for residents experiencing cognitive decline
This diverse range of care options allows residents to transition seamlessly between different levels of assistance as their health requirements change, without the disruption of relocating to entirely new facilities—a particularly valuable feature for elderly individuals seeking stability and continuity.
Leo Friedman: Controversial Figure in Senior Care Industry
While Friedman's Citadel Care Centers has established itself as a significant player in the senior living sector, the organization's trajectory hasn't been without controversy. The company's portfolio currently includes several New York-based facilities: Bronx Gardens, Hudson Pointe at Riverdale Center, Riverdale Rehab and Nursing, and The Plaza Rehab and Nursing Center.
In 2022, Friedman's business practices came under intense scrutiny when The Plaza Citadel Consulting Group—an affiliate of Citadel Care Centers—settled a civil healthcare fraud lawsuit with serious implications. The legal action alleged that the organization had systematically switched residents' Medicare coverage types specifically to maximize reimbursements from the federal health insurance program.
The settlement reached with federal authorities was substantial, with The Plaza and Citadel agreeing to pay nearly $7.9 million in damages. As part of the resolution, the companies made several damaging admissions, including acknowledging that they frequently failed to obtain proper consent from residents or their families before altering Medicare plans—a revelation that raised significant ethical concerns throughout the industry, according to the U.S. Attorney for the Southern District of New York.
Despite this controversy, Friedman has continued to expand his real estate holdings in Florida. In 2019, he invested $15 million to acquire a four-story, 32,000-square-foot commercial building at 49 Collins Avenue in Miami Beach, where the upscale restaurant Carbone currently occupies the ground floor space.
South Florida's Thriving Senior Living Market
The acquisition of Abbey Delray reflects a broader trend of continued investment and transaction activity in South Florida's senior living sector. The region's established reputation as a retirement destination ensures these properties maintain high occupancy rates and steady cash flows, making them particularly attractive investment vehicles in today's real estate market.
Recent comparable transactions highlight this robust market momentum:
- This month, healthcare real estate investment trust Welltower completed the purchase of the 220-bed Oakmonte Village of Davie at 8201 Stirling Road for $34.3 million
- In September, Focus Healthcare Partners acquired the 377-unit Mariposa assisted living facility at 9130 Hypoluxo Road in unincorporated Palm Beach County for $63.8 million
These transactions collectively represent over $128 million invested in South Florida senior living facilities in recent months alone, underscoring investors' confidence in the sector's long-term stability and growth potential.
Demographic projections further support this optimistic outlook, with Florida's 65-and-older population expected to represent over 30% of state residents by 2030, according to data from the Florida Department of Elder Affairs. This demographic shift continues to drive demand for various senior housing options, particularly in desirable coastal communities like Delray Beach.
Senior Living Investment Insights
What Makes Senior Living Facilities Particularly Attractive to Investors in Today's Market?
Senior living facilities offer multiple revenue streams through different care levels, relatively recession-resistant cash flows, and demographic tailwinds as the U.S. population ages. The healthcare component adds stability compared to traditional real estate investments, while the potential for upgrading facilities can create additional value-enhancement opportunities.
How does the Continuous Care Retirement Community (CCRC) Model Benefit Both Residents and Operators?
CCRCs like Abbey Delray offer residents the security of knowing they can access increasingly supportive care as they age without relocating, creating strong community bonds. For operators, this model reduces turnover costs, creates predictable cash flows across different care levels, and typically attracts more affluent residents seeking comprehensive long-term solutions.
What Red Flags Should Consumers Watch for When Evaluating Senior Living Facilities?
Prospective residents and their families should investigate ownership history, Medicare/Medicaid compliance records, staff turnover rates, and facility-specific violation histories. Transparency regarding fee structures, especially potential future increases, is also crucial. Facilities with recent ownership changes, like Abbey Delray, warrant particularly careful evaluation as operational philosophy may shift under new management.
How Might Friedman's Acquisition Affect Current Abbey Delray Residents?
When senior facilities change hands, residents may experience changes in staffing, fee structures, amenity offerings, or care philosophies. While legally binding resident contracts provide some protection, new ownership often implements operational changes that can significantly impact daily quality of life. Current residents would be wise to closely review any new policies introduced following the acquisition.
What Trends Are Shaping the Future of The Senior Living Industry in Florida?
The industry is increasingly incorporating technology (telehealth, monitoring systems), emphasizing wellness programs beyond basic care, developing specialized memory care units, and creating more apartment-like living spaces rather than institutional environments. Location remains paramount, with facilities in desirable areas like Delray Beach commanding premium rates and maintaining higher occupancy levels even during economic downturns.
