CHICAGO—Ventas, Inc., announced last Friday that it has signed a definitive agreement to acquire all real estate assets of Atria Senior Living Group—the fourth largest assisted living operator in the United States—for $3.1 billion. Payment will be comprised of $1.35 billion in Ventas common stock, $150 million in cash, and the assumption or repayment of $1.6 billion of net debt.
Ventas will acquire from Atria 118 private pay seniors housing assets located in several affluent markets, including the New York metropolitan area, New England, Boston, and California. The portfolio to be acquired, which consists of 110 stable assets and eight redevelopment assets, contains approximately 13,500 units, with a median community size of 110 units, a median community age of 12 years, and a current average occupancy rate exceeding 87%.
Louisville-based Atria will continue to manage the portfolio of communities and will remain an independent, privately owned management company.
“The addition of 118 exceptional seniors housing assets […] will establish Ventas as the largest owner of seniors housing communities in the United States,” said Debra A. Cafaro, Ventas chairman, president and CEO, in a release.
Ventas expects the portfolio to generate approximately $640 million in revenues in 2011.
Upon closing, Ventas will have more than 35,000 seniors housing units across 350 properties in its portfolio and will conduct business with four of the top five assisted living operators in the United States.
“This new relationship with Ventas will combine Atria’s senior housing management and operations expertise with the strength of an S&P 500 company known for making high quality, long-term real estate investments,” said Atria CEO John A. Moore. “This puts us in a position to keep our residents, employees and commitment to quality as our utmost priorities. Ventas' commitment to make a long term investment in our real estate will serve as the basis for the continued growth of the Atria platform.”
Completion of the transaction is subject to approval and other customary closing conditions. Ventas expects the acquisition to be completed in the first half of 2011.
Earlier this month, Ventas agreed to acquire the interests in 58 communities from Sunrise Senior Living, Inc., for $41.5 million. Upon closing, Ventas will own 100% of all 79 of its communities managed by Sunrise.