Ventas Healthcare may have just made its smartest strategic move yet, given the rising demand in medical office space and the ballooning health demands of the Baby Boom generation.
By purchasing its biggest rival, Nationwide Health Properties, for $7.4 billion, Ventas will create the largest healthcare real estate investment trust (REIT) in the nation and will become the largest owner of senior housing in the U.S., the company boasted Feb. 28. The massive new entity is valued at $23 billion and will own more than 1,300 facilities in 47 states, covering a whopping 14 million square feet of medical office space.
The combined entity will be senior-housing heavy, with 55 percent of its assets in senior living facilities (including those occupied by such LTC rock stars as Sunrise Senior Living and Brookdale Senior Living), 22 percent in skilled nursing facilities and 11 percent in medical office buildings.
And this may only be the beginning. With $8 billion in equity market capitalization, Ventas officials indicate they'll push for major growth this year. In fact, this latest move follows an acquisition by Ventas in October, when it grabbed up the real estate assets of Atria Senior Living Group for $1.5 billion in stock.
Just yesterday, Health Care REIT announced it will buy all of Genesis HealthCare's assets for $2.4 billion. The acquisition includes 150 properties. And in December, HCP Inc. revealed its $6.1 billion acquisition of 338 properties owned by nursing home behemoth HCR ManorCare, The Los Angeles Times reports.
Baby boomer wave drives up value of healthcare properties