Ventas Looking to Sell 8-Property Atria Portfolio Valued at $400M

Ventas (NYSE: VTR) is pitching for sale a portfolio of eight Atria Senior Living communities in six states, at a value of about $400 million.

That’s according to real estate publication Real Estate Alert, which cited recent marketing materials in its reporting. Ventas confirmed to Senior Housing News that the communities are being marketed for sale.

Real estate advisory firm Newmark Knight Frank is now taking bids on all or some of the properties on behalf of the Chicago-based real estate investment trust (REIT), the news source noted.

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The portfolio for sale consists of eight Atria communities totaling almost 1,200 units in Arizona, Texas, California, Massachusetts, Tennessee and Kentucky. The listed properties range in age, from 34 years old at the high end to 10 years old at the low end.

The communities have occupancy rates ranging from 70% to 93%, with an average rent of slightly more than $5,000 a month, according to Real Estate Alert. The portfolio’s net operating income had reportedly dropped 7% in the last two years.

“We intend to take specific actions, as we’ve stated, to build on Ventas’s many strengths and improve our senior housing performance to position us to capture the powerful upside that remains ahead,” Ventas Executive Vice President and CFO Robert Probst told Senior Housing News Thursday. “At the same time, we will continue to invest in our future, be good partners, stay productive, and focus on delivering value for our shareholders from the strong, diversified business we have built.”

Atria Senior Living declined to comment when reached by SHN.

Ventas’ senior housing operating portfolio (SHOP) performance was a sore spot at the end of 2019. During the third quarter, many of the REIT’s senior housing problems were concentrated in assisted living, particularly in secondary and tertiary markets. At the time, leaders with the REIT said they were reviewing options with operating partners for pushing rates and or even selectively disposing of certain underperforming assets.

On the whole, the senior living industry has had difficulty in recent years rebounding from average occupancy lows. The latest occupancy report from the National Investment Center for Seniors Housing & Care (NIC) showed an average senior living occupancy of 88% in the fourth quarter of 2019, a meager 10-basis point increase from the third quarter of last year. But there are signs that senior living occupancy is at a turning point. Assisted living occupancy increased to 85.7% percent in the fourth quarter of 2019, up from a recent record low of 85.1%

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