Harrison Street Buys, Sells $1.6B in Medical Office and Senior Housing Assets
The transactions consist of 40 properties across eight states and multiple counterparties.
Harrison Street has entered into a series of deals in which it has agreed to purchase 24 senior housing assets and sell 14 medical office properties for a total transaction value of $1.6 billion. These deals reach across eight states and consist of 40 properties with multiple sellers and counterparties.
Harrison Street has agreed to acquire a portfolio of 24 Class A senior housing properties focused on assisted living and memory care consisting of 2,195 units across California and Nevada for approximately $1.2 billion. Twelve properties were acquired from Healthpeak Properties and are operated by Oakmont Management Group. The remaining 12 properties are owned by Gallaher Cos., also operated by Oakmont, and many are either recently completed or currently under construction.
The Healthpeak stabilized portfolio has averaged 96% occupancy from 2016-2019. The properties, which are on average four years old, are located in Montecito, Escondido, Roseville, Alameda, Fair Oaks, Concord, Chino Hills, Whittier, Santa Clarita, San Jose, Valencia and Huntington Beach. The Gallaher properties are located in Camarillo, Oxnard, Stockton, Torrance, Sacramento, Novato, San Jose, Fullerton, Simi Valley, and Roseville, California as well as Las Vegas, Nevada.
“The senior housing sector remained resilient throughout the pandemic and is poised for growth,” Michael Gordon, global chief investment officer at Harrison Street said in prepared remarks. He also noted that the properties the firm is acquiring are “located in attractive markets backed by solid demographics, high barriers to entry and historically high occupancy rates.”
In addition, Harrison Street has agreed to sell to Healthpeak a 14-property medical office portfolio with 833,000 square feet across Virginia, Illinois, Minnesota, New Jersey, Oregon, Texas, and California for approximately $371 million. The properties are held across Harrison Street’s Core Fund and US Opportunity Funds.
The company remains committed to the medical office sector and continues to evaluate and acquire properties that meet its investment criteria, Gordon also said.
Since its inception, Harrison Street has closed 552 assets within the healthcare sector for a total cost of approximately $19.5 billion.