With the Inspir Carnegie Hill assisted living and memory care community expected to open early next year in Manhattan, Omega Healthcare Investors and Maplewood Senior Living are “actively looking for the next big opportunity” in urban senior living development, Omega CEO Taylor Pickett said Wednesday.
“The Maplewood team is incredibly active in looking for opportunities, and we’re very supportive of that,” he said during the real estate investment trust’s third-quarter earnings call.
“The lead times on these sort of things are long,” Pickett noted, adding that “in the meantime, we continue to find opportunities for their suburban product. They tend to be one-fifth or one-sixth of the size of Carnegie Hill, but they’re still quite additive.”
The Omega portfolio currently includes 15 Maplewood assisted living and memory care communities, said Steven Insoft, Omega’s chief corporate development officer.
Regarding the $285 million Manhattan property, he said that Maplewood is on track to meet the goal of having deposits on 30% to 40% of the units by the opening date.
“The market is accepting the product really well,” Insoft said, adding that he would anticipate the property being fully stabilized in “24-plus” months.
The REIT’s total senior housing portfolio includes 125 independent living, assisted living and memory care assets in the United States and the United Kingdom.
Bullish on the U.K.
Omega’s U.K. presence is set to increase; last week, after the end of the quarter, the REIT agreed to purchase from Healthpeak Properties (formerly HCP) its 49% joint venture interest in a U.K. portfolio consisting of 67 assisted living communities, as well as related development and capital loans, for $90 million. HCP is exiting the U.K. market.
The transaction is expected to close by year end, Chief Operating Officer Daniel Booth said.
“We’ve been opportunistic in the U.K. We’re still very bullish on it,” Pickett said. “We’re always kind of looking for new opportunities there.”
Acquiring Healthpeak’s U.K. portfolio will add two “quality” operators to the mix for Omega, he said. Currently, Omega’s portfolio includes U.K. operators Healthcare Homes and Gold Care.
“I think diversity is a good thing,” the CEO said. “The demographics over there are great.”
Omega will have the opportunity to buy out the other partner in the joint venture, Cindat Capital Management, in the future, he said, adding that the REIT expects to do more deals in the United Kingdom.
$735 million acquisition closes
Also after the end of the quarter, Omega closed on a previously announced $735 million acquisition of 60 facilities, Booth said. The purchase consisted of approximately $346 million of cash and the assumption of approximately $389 million in HUD mortgage loans. The portfolio includes two assisted living communities and 58 skilled nursing facilities across eight states, “with a significant concentration in the Southeast.”
“The facilities are leased at two operators, one being existing Omega operator, via three triple-net master leases,” Booth said.
Year-to-date, Omega has made new investments totaling approximately $1.5 billion, including capital expenditures, he said.
The company reported reported net income of $142.9 million, or $0.63 per common share, and operating revenues of $233.2 million for the quarter.
Editor’s Note: Read more about the earnings call on McKnights.com, the website of sister media brand McKnight’s Long-Term Care News, which covers skilled nursing.