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Welltower Announces $1B Deals, Gets $300M in Equity Capital

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Welltower Inc. (WELL - Free Report) has announced 11 separate Seniors Housing and Medical Office transactions for an aggregate investment volume of $1 billion. In a separate press release, the company stated that it has received $300 million in common stock investment from an affiliate of Qatar Investment Authority.

The Seniors Housing buyouts amount to $725 million at a blended cap rate of 6.6% across four deals. Three of these acquisitions enable the company to strengthen its relationship with existing operating partners. Further, Welltower shelled out $280 million for its Medical Office acquisitions at a blended cap rate of 5.9%. This includes a trophy Outpatient Medical complex spanning 286,000 square feet.

These off-market transactions are in addition to the previously announced Johns Hopkins deal worth $80 million and the MOB portfolio acquisition that enabled the company to acquire 23 assets for $400 million.

Specifically, Welltower is under contract to purchase 75% ownership interest in two "Class A+" MOBs in Charlotte, NC. Both properties are currently under development and are expected to be delivered in the second quarter and third quarter of 2020, respectively.  

Notably, the properties are fully leased to Atrium Health for 15 years. The project is part of a mixed-use development spanning 5.5 acres. On completion, it will include specialty clinical practices for Atrium Health.

In addition to this, the company has formed a joint venture (JV) with Southeast developer, Pappas Properties, to explore future opportunities for expansion in the region. Moreover, the JV can boost the development with additional 180,000 square feet.

Moreover, the company’s new equity investor Qatar Investment Authority has an option to acquire stake in Welltower’s development pipeline of urban senior living communities through a long-term partnership.

Over the past six months, shares of this Zacks Rank #3 (Hold) company have outperformed the industry it belongs to. During the period, the stock has rallied 25.3% compared with the industry’s growth of 3.9%.


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