The Real Deal National

Ventas acquires Canadian senior living developer in $1.8B deal

The Chicago REIT will acquire 31 senior living facilities in the deal
June 09, 2019 04:00PM

Ventas CEO Debra Cafaro and the Quebec City skyline (Credit: iStock)

Ventas CEO Debra Cafaro and the Quebec City skyline (Credit: iStock)

A chain of Canadian senior living facilities will soon get a taste of Chicago.

Ventas has announced it has a deal in place to acquire 85 percent of Le Groupe Maurice, a Quebec-based senior living developer, Globe St. reports. Chicago-based Ventas will pay $1.8 billion for the equity stake, and will take ownership of 31 senior housing facilities and four in-progress developments.

Le Groupe Maurice will continue to manage the properties and further develop senior living under the existing brand, according to Globe St. Ventas will have the rights to fund and own all additional developments. The Canadian firm is expected to average two-to-three construction starts per year.

The deal comes as Ventas seeks external business opportunities to return to year-over-year growth following a slowdown in the domestic senior housing market. The REIT has a 1,100-property portfolio that is heavily concentrated in senior housing, an industry that has grappled with occupancy issues as a flood of new inventory hits the market.

While the local senior housing sector has stalled, Canada’s market is poised for growth. The Canadian senior population is forecast to grow 50 percent by 2028, with minimal future senior housing deliveries, according to Globe St.

Ventas’ efforts to diversify its portfolio have paid off. Earlier this year, the REIT announced a $1.5 billion investment in university research facilities. Net operating income from research facilities already owned by Ventas increased by nearly 4 percent year-over-year in the first quarter. [Globe St.] – Joe Ward