“This acquisition deepens our collaboration with Axium and demonstrates our ability to create value through acquiring, integrating and managing a sizeable and varied portfolio of seniors living communities, which significantly solidifies Optima’s presence in Western Canada,” said Karim Kassam, Optima’s co-founder and principal in a statement.
“We believe there are strong tailwinds ahead for seniors housing due to sector demographics and a shortage of seniors living options creating long wait lists, especially for government-funded beds.
"From an investment perspective, construction for seniors living communities is at historically low levels; this sector continues to see asset appreciation with dependable income, making investing in this sector attractive.”
Vancouver-based Optima has operated independent and assisted-living care facilities in Alberta and B.C. since 2006, and has compiled a portfolio of 33 assets and over 3,400 beds.
Montreal-headquartered Axium Infrastructure is an independent portfolio management firm with offices in Canada, the U.S. and the U.K. It had over $10 billion in assets under management as of the end of 2022, as well as $1.7 billion in co-investments.
The Optima-Axium acquisition
Four of the assets are in Edmonton: the 169-suite Laurel Heights Retirement Residence, the 174-suite Lewis Estates, MacTaggart Place with 180 suites and the 172-suite Rutherford Heights.
There is also the St. Albert Retirement Residence in St. Albert, which opened in 2016, and Summerwood Village in Sherwood Park, a hamlet in Alberta. The latter has been open since 2008.
The sole Calgary asset is Sage Hill Retirement Residence, which was constructed in 2016.
The acquisition makes the joint venture one of the top seniors living operators by bed count in the Edmonton market, the companies say.
Dentons and National Bank Financial acted as legal and financial advisors, respectively, to the joint venture.
Optima says the acquisitions are in line with its goal to meet a "vast and increasing demand for seniors living and assisted care facilities" as Canada's aging population continues to grow.
It also fits with the company’s strategy to add both bed-type and geographic diversity to its portfolio, especially in Western Canada.
“The acquisition of these seven trophy assets adds to the track record of achievement of this objective,” Kassam added. “Over the last three years, we have delivered on our intentional growth, focusing only on Alberta and British Columbia.
"We have identified markets where we see potential for Optima and our investors, and opportunistically deployed capital to acquire institutional quality assets in synergistic markets, leveraging economies of scale to gain critical market share.”
The joint venture was established in November 2020. Axium owns a 90 per cent equity interest in the partnership, while Optima owns a 10 per cent equity interest and operates the facilities.
In October, Optima and Axium acquired eight seniors’ supportive-living communities from H&H Total Care Services in Alberta and B.C., comprised of 1,092 suites, for more than $300 million.
The properties together were known as The Hamlets. Three are in Alberta — two in Red Deer and one in Airdrie — while the B.C. properties are in Kamloops, Surrey, Penticton, Duncan and Vernon.
That portfolio included a mix of assisted-living and independent-living suites along with funded long-term care and complex care beds and private pay complex care beds.
EDITOR'S NOTE: This article was updated to correct the acquisition price to approximately$440 million, due to incorrect information which had initially been supplied to RENX.