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Chartwell Retirement Residences (CSH-UN-T) is acquiring 384 suites in three retirement communities on British Columbia's Vancouver Island for $226.9 million, adding to a long list of portfolio acquisitions in 2024.
The buildings, one in Victoria and two in Nanaimo, will “positively contribute to the overall quality of Chartwell's portfolio and expand our presence in the strong British Columbia market,” Jonathan Boulakia, Chartwell's chief investment officer, said in the announcement.
Mississauga-headquartered real estate trust Chartwell said it has definitive agreements for Vista Retirement Residence, Nanaimo Memory Care and The Edgewater Retirement Residence. The transactions are expected to be funded through a mix of net proceeds from the sales of non-core assets, cash on hand and its credit facilities.
In June, Chartwell acquired approximately 2,300 retirement suites in Quebec for $511 million, and was closing or negotiating the acquisitions for 85 per cent ownership in three Quebec residences from construction firm EMD-Batimo. In total, it reported $677 million of acquisitions closed or pending to that point in 2024.
These latest transactions would push that figure beyond $900 million.
Chartwell operates in Ontario, Quebec, British Columbia and Alberta. The acquisitions will be its first retirement homes on Vancouver Island, according to its website. The company now has 20 of its communities in B.C.
Expanding in Victoria
Vista Retirement Residence in the Victoria suburb of of Esquimalt consists of 152 suites. Built in 2023, it offers independent supporting living (104 suites), assisted living and memory care services (48 suites). The 11-storey building is currently 28 per cent occupied. The gross purchase price was $103.9 million, with $9.2 million held in escrow for the vendors’ 24-month net operating income guarantee.
Nanaimo Memory Care, which has 77 suites, is located in the north end of the city on Long Lake. Currently 88 per cent occupied, it was purchased for $20.3 million. The community was built in 2018, and is close to retail, medical care and entertainment amenities, Chartwell states.
Currently under construction, The Edgewater is adjacent to Nanaimo Memory Care. Upon completion, which is scheduled for Q2 2025, it will have 155 suites. Chartwell will acquire The Edgewater for $102.7 million when it is finished, of which $8.7 million will be held in escrow to support vendors' obligations under a 36-month net operating income guarantee.
The closings of the Vista and Nanaimo Memory Care acquisitions are expected in Q4.
All have been operated and/or developed by Avenir Senior Living, a company based in Scottsdale, Az., with a Canadian office in the Vancouver Island community of Brentwood Bay.
“We believe the quality of the acquired properties and their excellent locations, combined with our operating expertise, will support successful lease-up and multiyear occupancy and market rate growth. We are pleased to acquire these properties in Canada's retirement destination below current replacement cost," Boulakia said in the announcement.
Chartwell closing sales, financing
In the same announcement, Chartwell briefly went through other transactions it closed or is expecting to finish.
On Aug. 15, Chartwell closed the sale of one non-core retirement residence in Ontario for $10.8 million in cash. A day later, the real estate trust met the conditions for the sale of another non-core residence in Ontario, which will be settled for $79.5 million in cash and is to close in September.
In Q3, Chartwell expects to complete the $159.6-million financing of a 10-year Canada Mortgage and Housing Corporation-insured mortgage at average rates of approximately 4.15 per cent.
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