Welltower To Sell Senior Living Portfolio For More Than $740 Million

Real estate investment trust Welltower (NYSE: WELL) has reached a definitive agreement to sell a senior housing portfolio for more than $740 million.

The Toledo, Ohio-based company announced the transaction in its Q4 and full-year 2019 earnings release on Wednesday, but did not disclose which operating company is involved. Welltower declined to provide further details to Senior Housing News.

“In January 2020, we entered into a definitive agreement to sell a prominent seniors housing operating portfolio in the western United States for a gross sale price exceeding $740 million,” the earnings release states. “This portfolio consists of assisted living properties located in California, Nevada and Washington. The portfolio has occupancy of 97% and achieved NOI of $36.7 million in 2019.”

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This transaction follows another notable senior housing disposition for Welltower, which sold its Benchmark portfolio in the summer of 2019. That transaction involved 48 assisted living properties in Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. Private equity firm KKR purchased the portfolio for a gross $1.8 billion sale price. There is potential for $50 million in earnout proceeds linked to future sales.

But 2019 also saw Welltower expand its stable of senior housing operating partners, forming new RIDEA relationships with Denver-based Balfour Senior Living; Portland, Oregon-based Frontier Management; and Norwood, Massachusetts-based LCB Senior Living. Welltower also entered into a joint venture with Buffalo, New York-based Clover Management. And the REIT is the long-term capital partner for the joint venture of Related Cos. and Atria Senior Living, on a large pipeline of upscale urban developments.

For the fourth quarter of 2019, Welltower posted a same-store revenue-per-occupied-room (REVPOR) growth rate of 3.5% for its senior housing operating portfolio. Its funds from operations of $1.05 per share was in line with analyst expectations, and its $1.26 billion in revenue beat expectations by about $10 million.

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