On Sunday, the Ontario Teachers' Pension Plan (OTPP) announced that it had reached an agreement to sell a portfolio of premium seniors housing properties in Ontario and British Columbia owned under Amica Senior Lifestyles to Ohio-based real estate investment trust Welltower Inc. (NYSE: WELL) for $4.6 billion.
Ontario Teachers' originally invested in Amica in 2010 alongside Amica's two founders, Douglas MacLatchy and Robert Ezer. Through its wholly-owned subsidiary BayBridge Seniors Housing, OTPP then acquired Amica — then known as Amica Mature Lifestyles Inc. — in 2015, taking the company private.
As of this week's announcement, Amica Senior Lifestyles had a portfolio of 31 income-producing properties, seven properties under construction, and nine development parcels with entitlements in place, all in Ontario and BC.
According to Welltower, the portfolio of 31 income-producing properties — seven of which recently opened and are in lease up — is valued at $3.2 billion and Welltower is acquiring them "at a substantial discount to estimated replacement cost."
The $4.6 billion transaction is expected to be completed in phases.
By Q4 2025, the REIT is expected to close on the portfolio of 31 in-place properties and nine development parcels. At that point, Welltower will assume $560 million in CMHC-insured debt, with an average interest rate of 3.6% and average weighted maturity of four years.
The nine development parcels have not been identified, but Welltower says they are "located in highly affluent and supply constrained neighborhoods and have been entitled through elongated and onerous processes that have spanned over five years on average, providing Welltower with significant future optionality."
Welltower will then acquire the seven properties currently under construction as they achieve occupancy, which is expected to occur in stages between 2025 and 2027.
Although the portfolio appears to represent Amica's complete portfolio, Amica will remain operational, with Welltower simultaneously annoucing "a long-term strategic partnership" with Amica. No details of this partnership were announced, but Welltower cited Amica's "superior operational and development acumen."
"We are thrilled to announce our long-term partnership with Welltower, which shares our passion for providing the highest quality care and services to the seniors population," said Amica CEO Jens Cermak. "We also believe that we will be key beneficiaries of Welltower's industry-leading data science capabilities which will help scale our platform."
"We have been delighted to partner with and support Amica on their journey to empower seniors as they age," said OTPP Senior Managing Director of Private Capital Terry Woodward. "For more than a decade, we have supported the Company's management team as they have grown the platform. We are excited to watch the Company reach new heights in the future and wish Amica, the management team, and Welltower continued success in their next stage of growth."
Headquartered in Toledo, Ohio, Welltower Inc is an S&P 500 company formerly known as Health Care REIT and invests in health care infrastructure such as seniors housing, post-acute providers, and health systems. The company owns interests in properties in the United States and Canada, as well as the United Kingdom.
