A new 50/50 joint venture will enable real estate investment trust Welltower and global investors Reuben Brothers “to generate significant future growth opportunities through the development of the next generation of seniors housing properties” in the United Kingdom, Welltower announced late Tuesday.
The move comes at a time when “U.K. society is aging just like U.S. society is aging, and there is a lack of high-quality product,” Welltower CEO and Chief Investment Officer Shankh Mitra said Wednesday on the REIT’s fourth-quarter and full-year 2021 earnings call.
The U.K. joint venture follows Reuben Brothers’ acquisition of Avery Healthcare, one of Toledo, OH-based Welltower’s largest operating partners and the REIT’s largest partner in the United Kingdom.
Welltower has had a relationship with the assisted living and care facility operator for almost 10 years, according to a presentation released in conjunction with the earnings call. The partnership now includes 61 managed or leased senior living properties.
Reuben Brothers’ acquisition of Avery Healthcare marks the investors’ entry in the rental seniors housing and care home sector, a move that Mitra said “highlights the attractiveness of the opportunity that is ahead of us.”
David Reuben Jr. said in a press release that the investment “will be an exciting addition to our portfolio of real estate and operating companies, as we arrive at the precipice of unprecedented growth of the U.K. seniors population.”
Mitra said that the joint venture partners are excited about “the unprecedented multi-year growth opportunity in the seniors housing sector in the U.K. and the U.S., and we look forward to working alongside their team to expand our relationship.”
Reuben Brothers “owns some of the most prime land and real estate in the United Kingdom,” Mitra said during the REIT’s earnings call.
Notable fourth-quarter transactions
Notable senior housing transactions in the fourth quarter, Welltower said:
- The REIT acquired a portfolio of eight rental and six entrance fee communities from Watermark Retirement Communities for $580 million. The communities are located in “attractive” markets across the country, Welltower said.
- Welltower formed a new partnership with Quality Senior Living via the $172 million acquisition of a five-property portfolio of recently developed communities across the Mid-Atlantic and southeastern United States. Mitra said it was “perhaps the most exciting investment of the quarter” due to QSL’s strong performance as measured by several metrics.
- The REIT acquired seven seniors housing communities for $142 million, and they will be operated under new triple-net master leases with several existing operators.
- The REIT acquired a cottage-style active adult community in Venice, FL, for $115 million. The Floridian Club of Sarasota recently was constructed and is fully leased with a substantial waitlist, Welltower said. The Barrington Group will continue to manage the community.
- The REIT formed a new 98/2 joint venture with New Perspective Senior Living and simultaneously acquired three newly developed senior housing communities in fast-growing micro markets in the Midwest. The portfolio was acquired for $108 million.
- Welltower acquired two seniors housing properties in the Boston area from Wingate Senior Living for $100 million. Wingate will operate the communities.
- Welltower sold four properties previously leased to Genesis and one senior housing triple-net leased property.
Welltower has closed on approximately $600 million of investment in the past six weeks, Mitra said, describing the REIT’s pipeline as “robust, highly visible and actionable.”
The REIT may be able to announce new relationships with two operators on its next earnings call, he said. “One of them we already have shaken our hands this quarter,” Mitra said.
