PGIM Lends $460M on JV’s Purchase of Senior Living Portfolio from Welltower

Welltower’s stake in the 10-property portfolio is valued at $700M

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PGIM Real Estate has provided $460 million to a joint venture between AEW Capital Management and Merrill Gardens Senior Living to help facilitate their purchase of a 10-property senior living portfolio from real estate investment trust Welltower, Commercial Observer has learned. 

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The seven-year, fixed- and floating-rate mortgage was used by Boston-based AEW and Seattle-based Merrill to acquire Welltower’s stake and recapitalize the 1,057-unit portfolio, which comprises assets located along the West Coast. Merrill had previously managed the properties in partnership with Welltower and teamed with AEW to acquire Welltower’s interest in the portfolio, which is valued at $700 million, according to a report Monday from Senior Housing News, which first reported the sale. 

The portfolio has 29,000 square feet of retail and it includes a mix of independent living, assisted living, memory care and general apartment units, as per information from PGIM. The properties are located throughout California, Nevada and Washington, according to Senior Housing News, citing a second quarter property list from Welltower.

PGIM’s Trace Wilson, who led the origination, said that the firm’s execution “underscores the quality of the portfolio itself, which has properties located in sought-after infill locations that benefit from strong market fundamentals and favorable demographic trends.”

In late September, Silicon Valley Business Journal reported that Merrill Gardens had bought out Welltower on two senior living communities located in San Jose and Gilroy, Calif., effectively ending an operating partnership that Merrill had had with Welltower for a decade. It’s not immediately clear whether these two properties are a part of this sale, as a representative for PGIM was not able to confirm any details about the sale, the portfolio or the locations of the properties. 

A representative for AEW did not respond to an emailed inquiry prior to publication.