The 115 transactions recorded in Q3:23 represents the second-lowest quarterly deal total since the third quarter of 2021, when 111 deals were publicly announced, and shows the impact of high interest rates on the M&A market. There were just under 265 properties involved in Q3:23’s deals for a property-per-deal ratio of 2.3, equal to the ratio from Q2:23. Assisted living deals made up the plurality of Q3:23 deals, accounting for 49%, followed by skilled nursing at 41%. Independent living, CCRCs and affordable senior apartment deals each comprised approximately 3.5% of Q3:23 deals, while there were no publicly disclosed active adult deals.

While Q3:23 saw a healthy transaction level, there were not many large portfolio deals, for the most part. The average transaction size, measured by properties per deal, has steadily fallen since its recent peak of 6.6 properties per deal in Q2:21 and 5.9 in Q3:21. In Q3:23, there were nine portfolio deals involving more than five properties in each, compared with 17 in the year-ago third quarter.

“COVID-19 has many lingering effects in the senior care industry, inflation is elevated, staffing is scarce and expensive, interest rates are historically high and pricing out buyers, cap rates have risen to effectively halt many low-cap rate active adult sales, and values are low enough to keep many potential sellers from selling,” added Swett. “This is all to say, for transaction volume in 2023 to virtually equal that of 2019 is surprising, to say the least.”

All long-term care M&A deals dating back to 1993 can be accessed on the LevinPro database and can be purchased via a site license. All quarterly results are published in The Health Care M&A Report for all 13 sectors of health care, which is part of LevinPro HC. In addition, annual results of the seniors housing and care acquisition markets will be published this year in the 28th Edition of The Senior Care Acquisition Report. For information, or to subscribe, call 800-248-1668. Irving Levin Associates was established in 1948 and has offices in New Canaan, Connecticut, and North Bethesda, Maryland. The company publishes research reports and newsletters, and maintains databases on the healthcare and seniors housing M&A markets.

Media Contact

Ben Swett, Irving Levin Associates, (203) 846-6800, [email protected], https://www.levinassociates.com/ 

SOURCE SeniorCare Investor