The senior housing and care market ended 2014 on a strong note, with sales and deal volume both making leaps from the previous year, according to data released by the National Investment Center for Seniors Housing & Care (NIC) on Tuesday.
More than $17 billion in seniors housing and care properties were acquired in 2014, up nearly 20% form the previous year, NIC data show. And, in terms of the number of deals, 2014 was the most active year on record, with more than 500 deals closed.
“Sales volume in 2014 was second only to 2011’s record total of $27.6 billion, which was dominated by a handful of multibillion dollar [real estate investment trust] REIT transactions,” NIC says in a statement.
While it’s difficult to predict how the market will play out this year, especially if interest rates change significantly, “momentum has been building towards more deals getting done,” Chris McGraw, NIC’s senior research analyst, tells SHN.
“We saw 113 deals close in 2009 and since we’ve seen the number of deals increase each year by an average of 36% to the current annual total of 533 during 2014,” he says.
Publicly-traded companies continued to dominate the market, with their volume totaling nearly $10 billion last year, data show. Private companies also remained very active with their acquisitions at more than $5 billion in 2014.
“Institutional investors continued to be the smallest investor type, but their activity has been consistently growing over the last few years,” NIC says. “In 2014, institutional players acquired $1.8 billion in seniors housing and care real estate, up 13% from the previous year.”
Written by Cassandra Dowell