Senior housing acquisitions continue to occur at a face pace, thanks in part to demographic changes that are boosting demand for their services. Before the Federal Reserve raises interest rates, as it is projected to do sometime next year, senior housing providers and investors seeking capital should contact the Chicago-based financing firm Cambridge Realty Capital to learn more about the wide variety of financing options it offers for senior housing transactions.
Major REITs Continue to Acquire Senior Housing Properties
Last week, the real estate investment trust Health Care REIT announced that it expects to spend approximately $1.7 billion acquiring properties from now until the end of the year. This includes its previously announced purchase of HealthLease Properties REIT for $950 million, its purchase of Gracewell Healthcare for $257 million, and an additional $535 million it expects to use on future acquisitions. Health Care REIT expects to spend $371 million on senior housing operating properties, $468 million on senior housing triple-net lease properties, $306 million on medical office buildings, and nearly $600 million on long-term care and post-acute properties.
In addition to Health Care REIT, Aviv REIT is an active buyer in the senior housing market. Aviv REIT recently announced it purchased an assisted living facility and four long-term care and post-acute skilled nursing facilities in Washington state. It also purchased a campus in Idaho that includes a skilled nursing facility and an assisted living facility. Aviv REIT spent $83.6 million on these purchases, increasing the total amount they spent on acquisitions in the third-quarter to $182 million. Aviv REIT has a triple-net lease agreement with its existing operator, EmpRes, for the Washington properties. According to chairman and CEO Craig Bernfield, Aviv REIT is very excited about these recent acquisitions, potential future acquisitions, and its relationship with EmpRes.
Following the announcement of its Washington acquisitions, Mr. Bernfield stated, “We are pleased with the consistently strong pace of our investment activity, and, as we have anticipated, the depth and quality of the opportunities we are identifying in the market.” He also stated, “This investment with EmpRes is further evidence that the commitment and effort we make to support our operator relationships creates ongoing opportunities to invest in off-market transactions in attractive markets all across the country.” Mr. Bernfield’s statements indicate that Aviv REIT will continue to remain an active buyer in the senior housing market for the remainder of the year.
As the third-quarter draws to a close, acquisitions in the senior housing space by REITs and other industry participants continue at a rapid clip. Many analysts believe this will continue into the fourth quarter, but might begin to slow down next year if interest rates rise as projected. Before this occurs, and the cost of capital increases, industry participants seeking capital for purchases or for other needs should look to Cambridge Realty Capitaland the many different financing options it offers for senior housing transactions.