2019 Sets Senior Care M&A Record
What a year it was. We have now recorded 447 publicly announced seniors housing and care transactions in 2019, which is not only a record, but is also still just a preliminary number. Coming off of another record-breaking year in 2018, with 430 deals, the industry has amazingly surpassed that level of activity, by a whopping 5%. That’s what a lot of cheap capital can do. A busy fourth quarter pushed the sector to that unprecedented total, with 110 deals announced. As has historically been the case, private senior care providers made up the majority of buyers, accounting for nearly 50% of all Q4 acquisitions. REITs and real estate investment... Read More »
Fourth Quarter Occupancy Nudges Up
Some good news was recently released by NIC MAP, showing occupancy rates for stabilized seniors housing communities (independent living and assisted living) increasing by 10 basis points sequentially, but a four-basis point decline year over year. The assisted living market, which has been the most troubled over the past several years, saw a 20-basis point increase sequentially, but a 14-basis point decline year over year. The bottom line is that while some progress has been made recently, we are still way behind a year and two ago, with a long way to go to really get to “stabilization” as an industry. The other good news is that absorption is running ahead of trailing-12 month new... Read More »
Dissecting the Jump in Average Assisted Living Values
It’s amazing the difference that one deal can make. We are talking about Welltower’s $1.76 billion sale of its entire Benchmark Senior Living portfolio to KKR and its impact on the average private per assisted living unit sold in the most recent four quarters. That sale, which came in at $425,400 per unit across the 48 properties, pushed the sector’s weighted average up to $252,900 per unit, a 23% increase from the most recent four-quarter period ($205,900 per unit) and 36% from calendar year 2018 ($186,400 per unit), according to The Seniors Housing Acquisition & Investment Report. We should note that this average is likely to change as more deals from 2019 float to the surface, and... Read More »
Independent Living Values Continue Impressive Rise
As the assisted living market is mired in a difficult operating environment, plagued with overdevelopment in some markets, heavy discounting and stubbornly low census, independent living continues to show its resiliency. According the our rolling four-quarter pricing multiples, a product of The Seniors Housing Acquisition & Investment Report, investors paid an average of $272,300 per unit for independent living properties in the last four-quarter period ending this September. That represents a 6% increase from the average of the four quarters ended June 2019 of $257,800 per unit, and a 14% jump from the calendar year 2018 average of $238,100 per unit. So, what could cause such a... Read More »
Skilled Nursing Values Hold Steady
The skilled nursing M&A market has continued to surprise us. Despite numerous headwinds, especially involving the rising cost and scarcity of labor as well as the declining lengths of stay and census across the industry, buyers are still flocking to the sector. And as a result, they have kept values steady at just below $80,000 per bed. In the last four quarters ended September 30, skilled nursing facilities sold on average for $78,500 per bed, just slightly higher than the $77,500 per bed average price for 2018, according to The Skilled Nursing Acquisition & Investment Report. We should note this is a preliminary figure, as deals will inevitably float to the surface as the year... Read More »Schedule a demo
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