American Healthcare Pays $572M for Senior Housing Portfolio
The acquisition is part of an $873 million transaction involving eight communities.
American Healthcare REIT has acquired six senior housing communities from Kensington Senior Living for approximately $572 million. Totaling 464 units, the properties are part of a larger eight-community, 745-unit portfolio with an aggregate purchase price of roughly $873 million.
The remaining two communities are under definitive purchase agreements and are expected to change hands in the fourth quarter of this year, subject to customary closing conditions. Kensington will continue to operate the properties following their respective acquisitions.
Earlier this year, American Healthcare REIT closed a 13.25 million-share common stock offering priced at $53.75 per share, with potential gross proceeds of roughly $712.2 million intended to support the Kensington acquisition. The offering was structured through forward sale agreements with Morgan Stanley, Citibank and KeyBanc Capital Markets.
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The acquisition expands American Healthcare’s senior housing platform in several high-barrier markets, including the Los Angeles, San Francisco Bay Area, Washington, D.C., and New York metros. The communities are in infill submarkets where new supply is limited by scarce developable land, restrictive zoning and lengthy entitlement timelines.
Kensington developed seven of the eight purpose-built communities. Roughly 93 percent of the portfolio’s units are designated for assisted living and memory care, aligning with American Healthcare’s focus on higher-acuity senior housing.
The deal comes as investor appetite for senior housing continues to rebound. Over the 12 months ending in May, the sector recorded $33.3 billion in investment sales, an 83 percent increase from the previous 12-month period. The recovery has been supported by improving occupancy, limited new supply and strong demographic tailwinds, factors that are also shaping the future of senior housing.
American Healthcare’s recent senior housing investments
After the acquisition, American Healthcare’s year-to-date investment volume rose to more than $2 billion. The company also has an awarded investment pipeline exceeding $675 million, which it expects to close using match-funded equity proceeds from unsettled forward agreements.
The company’s recent deal activity includes two additional closings in August. The firm paid $197 million for the acquisition of a two-community senior housing collection in California. Affinius Capital and Alliance Residential Co. sold the assets, marking one of the largest senior housing portfolio sales in Northern California in recent years.
The other deal comprises Avella at Almaden, a 200-unit luxury senior housing community in San Jose, Calif. A joint venture that also includes Affinius Capital and Alliance Residential Co., along with The 11th Group Inc., sold the asset for $102.8 million.
