As Ryan Saul blogged in July (http://seniorlivingbrokerage.com/reit-buyers-quiet/) and Senior Housing News commented on this week (http://seniorhousingnews.com/2016/10/19/senior-housing-ma-continues-decline/), Seniors Housing M&A activity has dipped over the past couple of quarters due to decreased activity among the majority of Public Healthcare REITs.
According to Bill Kauffman, NIC’s senior principal, the main reason that the transaction market has slowed “has been the drop in buyer volume from the publicly traded companies – mainly the three big REITs (Ventas, Welltower and HCP).”
How does the Public Healthcare REITs Slowing Down Affect Asset Pricing?
For the large institutional level portfolios, this could impact the pricing and capitalization rates as cost of funds have increased for Public Healthcare REITs.
For the Single Facility and Small Portfolio Owners, There is Good News.
With likely Buyers of single facility and small portfolios (Private Healthcare REITs and owners), there has been a transaction volume in the 3rd quarter of 2016 of over $1 billion for the 13th quarter in a row. According to Kauffman, “there is a large amount of private capital searching for yield given the continual low interest rate environment”. Private Healthcare REITs and owners are still active buyers.
If you are an owner of a single facility or small portfolio, now is a great time to consider selling your asset(s). The Private Healthcare REITs and Owners are still aggressively pursuing assets like yours. I would be happy to prepare a complimentary confidential marketing proposal of your facility or portfolio.
At Senior Living Investment Brokerage, Inc., we have a long track record of independent seniors housing sales and serving the needs of independent owner-operators. We have completed several transactions recently for single facility and small portfolio operators.
If you have any questions on the topic of this post, please contact Matthew Alley at 630-858-2501 ext. 225 or alley@slibinc.com or http://www.matthewalley.com
