Seniors Housing and Care M&A Activity Hits Record in 2022, According to Data From LevinPro LTC

Seniors housing and care M&A activity hit an all-time high in 2022 with 527 transactions, according to data from LevinPro LTC. That is 17% higher than the 450 transactions recorded in 2021. However, the fourth quarter of 2022 saw dealmaking slow to 106 deals, down from 136 in the third quarter of 2022 and from 141 in the fourth quarter of 2021.

NEW CANAAN, Conn., Jan. 9, 2023 /PRNewswire-PRWeb/ -- The number of publicly announced seniors housing and care acquisitions in 2022 rose to 527 deals, based on new acquisition data from LevinPro LTC. This represents a 17% increase from the 450 transactions disclosed in 2021. However, the $14.02 billion spent on 2022 transactions fell by 27% from the $19.32 billion spent on 2021 transactions, based on disclosed prices.

"The year 2022 was a tale of two years: the first eight months of the year, and then the last four when the 10-year Treasury rate rose above 3.5%," stated Ben Swett, Editor of The SeniorCare Investor. "To many, that moment in September killed a host of deals and caused plenty of investors and lenders to put their pencils down for the rest of the year."

The fourth quarter of 2022 ended with 106 transactions, down from 136 in the third quarter of 2022 and from 141 in the fourth quarter of 2021. That represents the lowest quarterly deal total since the first quarter of 2021, when 85 deals were publicly announced, and shows the impact of high-interest rates on the M&A market.

There were just under 2,000 properties involved in the 450 transactions of 2021 for a property-per-deal ratio of 4.4, versus just under 1,700 transactions across the 527 deals of 2022 for a property-per-deal ratio of 3.2. There were more large-scale acquisitions in 2021, such as the sales of DigitalBridge Group's healthcare assets ($3.21 billion), New Senior Investment Group ($2.3 billion) and the owned portfolio of Holiday Retirement ($1.58 billion).

Whereas the largest deals of 2022, by disclosed purchase prices, were Dwyer Workforce Development's $590 million acquisition of 50 skilled nursing facilities in Texas and the acquisition of Stonerise Healthcare's 17 skilled nursing facilities in West Virginia for an estimated $615 million. In fact, most of the largest deals of 2022 featured skilled nursing assets as investor interest in the sector grew throughout the year. Skilled nursing deals represented just 41% of the year's transactions, with the seniors housing sectors of active adult, independent living, assisted living, memory care, CCRCs and affordable age-restricted housing making up the other 59%. But the sector accounted for 53% of the properties sold in 2022, compared with 47% for the seniors housing sectors combined. And in the last four months of the year, the proportion of SNF deals rose to 45% and SNF properties sold rose to 67%.

"Investor interest in skilled nursing facilities stayed strong throughout much of 2022, but high-interest rates and conservative lending terms should lower acquisition activity in the near term," added Swett. "However, if the capital markets dissuade some owners from selling, distressed deals may dominate the market in the first half of 2023."

All long-term care M&A deals dating back to 1993 can be accessed on the LevinPro database and can be purchased via a site license. All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of LevinPro HC. In addition, annual results of the seniors housing and care acquisition markets will be published this year in the 28th Edition of The Senior Care Acquisition Report. For information, or to subscribe, call 800-248-1668. Irving Levin Associates was established in 1948 and has offices in New Canaan, Connecticut, and North Bethesda, Maryland. The company publishes research reports and newsletters, and maintains databases on the healthcare and seniors housing M&A markets.

Media Contact

Ben Swett, Irving Levin Associates, 203-846-6800, [email protected]

SOURCE Irving Levin Associates