The number of publicly announced senior housing and care acquisitions is trending downward, whereas the total dollar amount of those investments is increasing, according to data released Tuesday by Norwalk, CT-based Irving Levin Associates.
With a total of 101 transactions, the number of deals in the third quarter topped 100 for the sixth consecutive quarter. The amount, however, represents a 12% decrease compared with the second quarter, which saw 115 such deals, and a 15% drop from the third quarter of 2018, which had 119.
Purchasers committed $5.7 billion to senior housing and care deals in the third quarter, however. The dollar amount is 36% more than the $4.2 billion in the second quarter, 111% more than the $2.7 billion in the first quarter, and 171% more than in the third quarter of 2018, when deals totaled $2.1 billion.
“Labor and occupancy headwinds, particularly in assisted living, have not stopped the flow of capital into the seniors housing sector, keeping values steady and M&A activity on track to surpass 400 deals in 2019,” said Ben Swett of Irving Levin.
Private senior housing and care operating companies accounted for 48% of acquisitions, whereas private equity firms, real estate investment trusts and private real estate investors accounted for 52%, according to the data.
The Ensign Group, Chicago Pacific Founders and Welltower announced four transactions each in the quarter, Irving Levin noted. Welltower also participated in the largest deal of the quarter, selling its entire Benchmark Senior Living portfolio to KKR & Co. for $1.8 billion.
Senior living, defined as independent living, assisted living and memory care properties, continued to attract most of the interest from investors, representing 58% of the quarter’s deals and accounting for six of the top seven deals by price.