REAL ESTATE NEWS

AEGIS AND BLUE MOON ACQUIRE $350M SENIOR LIVING PORTFOLIO

Published on Tuesday, January 12, 2021

The 10 communities across California, Washington and Nevada include more than $350 million in senior living assets in urban high-barrier-to-entry markets with desirable demographics and limited existing supply.

 

SAN FRANCISCO—Assisted living and memory care provider Aegis Living, along with senior housing private equity investor Blue Moon Capital Partners LP, just announced a second joint venture with the acquisition of 10 communities across California, Washington and Nevada. While it is not the largest deal in the senior living industry, the acquisition illustrates Aegis’ steady footprint in senior living when others are exiting or wavering.

It is, however, the largest deal in Aegis Living’s 24-year history. It includes more than $350 million in senior living real estate, supporting the company’s dedication to owning its communities and goal of rapid growth during the next 10 years. The 702-unit portfolio consists of assisted living and memory care apartments all in urban high-barrier-to-entry markets with attractive demographics and limited existing supply.

Aegis Living previously operated these communities under a lease. With today’s announcement, Aegis has ownership in more than 70% of its 32 communities.

“At a time when we are seeing many operators and traditional senior living investors leave the market, we are leaning in,” said Kris Engskov, Aegis Living president. “The challenges presented by COVID-19 have made clear just how critical senior care is and will increasingly become. We have learned a great deal during the pandemic and look forward to putting many of those lessons to work to keep even more seniors safer.”

The pandemic has disproportionately impacted senior living communities across the country. Amid the temporary industry downturn, Aegis Living kept its 32 communities open and is well-positioned for the looming resurgence in the demand for high-quality senior living options. Census Bureau data projects one in every five Americans will be of retirement age in less than 10 years. Not only will senior living demand naturally increase, the style and manner will continue to evolve based on each generations’ expectations, including COVID-19’s impact.

“The future of the senior living industry has never been stronger and those with a robust owner-operator presence will be best positioned to meet the growing demands for high-quality senior assisted living and memory care,” said Dwayne Clark, Aegis Living founder, CEO and chairman. “We are just getting started on our plans to double in size by 2030.”

In 2018, Aegis Living and Blue Moon established its first joint venture agreement with an initial purchase of three class-A high-value communities. The 10 properties in the second joint venture include:



  • Aegis Living Callahan House (Shoreline, WA)


  • Aegis Living Shoreline (Shoreline, WA)


  • Aegis Living Kirkland (Kirkland, WA)


  • Aegis Living Las Vegas (Las Vegas, NV)


  • Aegis Living Dana Point (Dana Point, CA)


  • Aegis Gardens Fremont (Fremont, CA)


  • Aegis Living Granada Hills (Granada Hills, CA)


  • Aegis Living San Francisco (San Francisco, CA)


  • Aegis Living Pleasant Hill (Pleasant Hill, CA)


  • Aegis Living Ventura (Ventura, CA)




In addition to the acquisition of these 10 communities, Aegis Living has eight communities in development with several opening in 2021: Aegis Living Bellevue Overlake (Spring 2021), Aegis Living Kirkland (Summer 2021) and Aegis Lake Union (Fall/Winter 2021).

“We are proud to grow our successful relationship with Aegis Living, following our first joint venture with them two years ago,” said Kathryn Sweeney, co-founder and managing partner at Blue Moon. “Dwayne Clark and the Aegis Living team continue to show they are willing to innovate and stay well ahead of the curve to serve our seniors. Their energy, passion and skill have met the COVID-19 challenges presented this past year for the benefit of residents, families, staff and investors.”

Engskov says Aegis’ ability to weather the pandemic is attributed to several factors. For one, it has led the way in resident safety and innovation. Aegis developed new opportunities for families and residents to connect through initiatives such as Outdoor Living Rooms and Chat Suites. Moreover, it continues to explore the latest technologies such as Molekule, an air purification system that can help prevent the spread of COVID-19 and promote an overall healthier environment, he says.

“The pandemic has sadly cost the senior living industry countless jobs and billions in revenue, as concerns about safety and isolation have made many families reconsider their options,” Engskov tells GlobeSt.com. “At Aegis Living, despite these fears and other challenges like construction delays and regulations on resident move-ins and visitation restrictions, we remain on track to double in size over the next 10 years and have maintained resident occupancy of about 85% from the start of the pandemic. All of this coupled with vaccines now being available, makes Aegis Living extremely attractive right now to families and individuals considering senior living, and in turn, lenders and investors helping to make new communities a reality.”