Low interest rates and strong demand for senior housing services are driving an increase in senior housing acquisitions this year. Interest rates remain low relative to historical norms, demand for senior housing services continues to rise across the country, and acquisition activity in the space remains strong. Providers and investors interested in taking advantage of the strong market for senior housing assets should contact Cambridge Realty Capital to learn more about the many different financing options that it offers for acquisitions and other capital investments.
In the Mid-Atlantic and Northeastern regions of the country, Harrison Street Real Estate Capital recently acquired 11 senior housing properties in Maryland, Massachusetts, Pennsylvania, Virginia, and Rhode Island. Harrison purchased the portfolio for $520 million from a joint venture between The Shelter Group and its Brightview Senior Living partner. The properties contain a combined 1,600 units. Approximately half of those units are dedicated to independent living residents, with the remainder dedicated to assisted-living and memory-care residents. The Shelter Group will continue to operate these properties through Brightview. This purchase is in line with Harrison Street’s strategy of holding private-pay properties that allow residents to age in place. According to Harrison, each facility is located in a market characterized by favorable demographics and significant barriers to entry.
Also in the Northeast region, LCB Senior Living recently purchased two senior housing properties in Vermont for $82.4 million. LCB bought both properties from Bullrock Corporation of Vermont. The properties contain units and cottages dedicated to independent living, assisted living, and memory care residents. One of the properties, the Residence at Shelburne Bay, is a two-building campus with 191 apartments. The other property, the Residence at Otter Creek, contains 131 units and sits on a 30-acre campus. LCB’s CEO Michael Stoller is extremely excited about his company’s new properties, and looks forward to integrating them into his company’s portfolio. According to Stoller, “These two properties are among the finest acquisitions that LCB has made. They are high-performing assets that yet have tremendous upside, and we’re very fortunate to have obtained them.”
Numerous other acquisitions continue to take place in other regions as well. Many analysts expect the pace of M&A activity to continue as long as low interest rates and strong demand for senior housing services remain in place. However, most analysts expect the Federal Reserve to raise its benchmark federal funds rate sometime next year, which will affect the cost of borrowing. Before interest rates start to rise, senior housing participants seeking capital to acquire additional assets should contact Cambridge Realty Capital for assistance with their financing needs.
