TODAY’S DEALS: Health Care REIT Announces Big Investment Partnership

Health Care REIT will invest approximately $1 billion into a Canadian portfolio partnership; Morgan Properties and DRA acquire a 620-unit asset; and Marcus & Millichap arranges the sale of a distressed community in Tampa.

Toledo, Ohio—Health Care REIT, an Ohio-based seniors housing and healthcare owner and operator, has partnered with Ontario-based seniors firm Revera Inc. to own approximately 47 communities with around 5,000 units located in major Canadian markets. The transaction is expected to close in the second quarter of 2013. The portfolio is detailed in the chart below:

Health Care REIT/Revera Partnership Details

When all is said and done, Health Care REIT will own a 75 percent interest in the approximately $1.35 billion portfolio, with Revera handling the remaining 25 percent. The portfolio is currently 100 percent owned by Revera and primarily composed of independent living communities. Revera will continue to manage the assets under an incentive-based management contract.

“This acquisition solidifies Health Care REIT as a leading capital provider to the private-pay seniors housing industry across Canada,” says George Chapman, chairman and CEO of Health Care REIT. “We are excited to partner with Revera, a premier seniors housing provider, whose portfolio complements our existing Canadian seniors housing portfolio. In partnership with the two leading operators in Canada, we now own more than 13,000 units of private-pay seniors housing in Canada, with a concentration in infill locations in major metropolitan markets.”

Morgan Properties, DRA acquire 620-unit community

Northampton Apartments

Largo, Md.—Morgan Properties and its equity partner, DRA Advisors, have formed a joint venture to acquire Northampton Apartments, a 620-unit community located in Largo, Md. Jones Lang LaSalle represented the seller, Equity Residential. The sales price was not disclosed.

“Northampton is an exciting acquisition for our company,” says Mitchell Morgan, founder and CEO of Morgan Properties. “We look forward to establishing a JV Partnership with DRA. David Luski and I have had a longstanding relationship in the real estate industry. We felt that it was a compelling acquisition opportunity to pursue together. We feel that our Maryland team will add tremendous value to the asset.”

The asset was originally built in two phases in 1977 and 1987 by the Artery Group. Amenities include tennis courts, a large swimming pool and two playgrounds. Morgan and DRA plan to execute a value-add repositioning strategy that will address capital needs and renovations.

Marcus & Millichap completes a 241-unit sale in Tampa

Avalon Village

Tampa, Fla.—Marcus & Millichap Real Estate Investment Services has brokered the sale of Avalon Village Apartments, a 241-unit community located in Tampa. The sales price was $4.6 million. The asset was sold by a local limited liability company. The buyer was a private South Florida investor with a capital investment coming from Argentina.

“Avalon Village was a distressed asset with only 50 to 60 percent occupancy at the time of sale, and with a good amount of deferred maintenance. The seller had defaulted on his loan and his lender was forcing the sale,” says Casey Babb, senior multifamily associate at Marcus & Millichap.

Avalon Village was built in the 1970s and is in the University West submarket of Tampa. Amenities include basketball courts, a swimming pool, laundry facilities and an on-site clubhouse/leasing center.

“The buyer purchased the property on an all-cash basis with plans to invest between $500,000 and $1,00,000 in capital improvements during the first year,”adds Aaron O’Connor, associate at Marcus & Millichap. “As in the last cycle, we’re seeing capital moving north from the white hot Miami market and into more reasonably priced assets in the Tampa and Orlando markets.”

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