We recorded 133 publicly announced seniors housing and care transactions in the third quarter, for an average of over 44 deals a month. That is the fourth-highest quarterly deal total ever recorded by LevinPro LTC, but is lower than the each of the last three quarters. What is very interesting though is that the rolling-12-month deal total has never been higher.
In the period from October 1st, 2021 to September 30th, 2022, we have recorded 553 publicly announced transactions, down just one deal from the previous 12-month span ending August 31st, 2022, and that total has crept up steadily throughout the year. It’s also a preliminary total that is bound to rise. To put it in perspective, the record for any calendar year was 455 deals in 2019, so we are in the midst of the busiest M&A period in history.
However, September’s 37 deals certainly ended the quarter on a down note, and based on what we are hearing, we are not expecting a bounce back in October. Deal delays in Florida alone due to Hurricane Ian and a moratorium on new insurance policies for a brief time in the state following the storm could see to that as well, in addition to higher interest rates and other regulatory issues halting deal activity. We aren’t predicting a collapse in the M&A market, but we don’t need to tell most of you that getting deals done these days is just much harder and are usually coming with lower prices. That’s bad for sellers but potentially good for the industry, as greater due diligence, more caution and facilities acquired at a lower basis should lead to fewer problems down the road for the new owners and their capital providers, as long as everyone is okay accepting a lower return.
