Add another big-name player to the list of experts believing that the skilled nursing real estate market is heating up.
Officials with CareTrust REIT became the latest to stake that claim Thursday during a call with investors. They said they have seen a noticeable uptick in activity in recent months, and now have almost $300 million in skilled nursing acquisitions in the pipeline.
“After a slow start to 2018, we were pleased to finish the year with several solid acquisitions and our most robust pipeline in a long time,” Chairman and CEO Greg Stapley said in an announcement.
Asked to elaborate on what’s causing the uptick, Chief Investment Officer Mark Lamb couldn’t key in on anything specifically. But he noted that the pipeline of available properties consists largely of SNFs that are not seen as fitting into other companies’ strategic goals, perhaps because of their geographic footprint. Others are just assets that operators are looking to exit, “for whatever reason.”
“I don’t know that we are seeing a particular pattern so far in 2019,” Lamb said. “I can tell you that we’ve seen an uptick in total transactions from late in the year. We’re seeing a lot of deals.”
As proof of that notion, CareTrust officials ticked off a slew of recent transactions that the company has executed since the tail end of last year. Those included acquiring a 110-bed SNF in Fargo, ND, for $14.4 million; a 55-unit skilled nursing and assisted living campus in Huntington, WV, for $7.2 million; a 58-bed SNF in Forest Hills, MI, for $4.4 million; and a 134-bed SNF in Parker, CO, for $19.6. All told, CareTrust spent more than $116 million on acquisitions in 2018, which it characterized as a “pretty light year.” It closed December with 194 properties, 140 of which offer skilled nursing services.
Already since the start of 2019, the San Clemente, CA-based real estate investment trust has also acquired a 128-bed skilled nursing and assisted living campus in Mount Carmel, IL, for $9 million, along with a 503-bed, four-property SNF portfolio in California for another $43.9 million.
Officials declined to get into the specifics of another $211 million, 12-facility deal in the Southeast that is now in the works with BME Texas Holdings. “We’re not out of the woods on that yet,” Stapley told investors. “We will give you more information as hurdles are cleared.”