Welltower Inc. (NYSE: WELL) made a nearly $5 billion cash offer for Healthcare Realty Trust Inc. (NYSE: HR) that was ultimately rejected, the Wall Street Journal reported this week.
Despite the initial deal not working out in Welltower’s favor, the Toledo, Ohio-based real estate investment trust (REIT) remains interested in a potential acquisition, the WSJ reported.
Healthcare Realty Trust agreed to merge with Healthcare Trust of America Inc. (NYSE: HTA) in February, joining the REITs in an approximately $10 billion deal that included mostly stock options. The combined company would have 727 properties totaling 44 million square feet, making it the largest medical office REIT in the country.
About a month after the agreed merger was announced, Welltower offered $31.75 per share for Healthcare Realty Trust in a deal that amounted to $4.8 billion, according to the publication.
Welltower reportedly sought to finance the deal with cash and a fully-committed bridge loan, with the senior housing REIT offering to pay a $163 million termination fee Healthcare Realty would owe for walking away from the transaction with Healthcare Trust, the article states.
Healthcare Realty ultimately rejected the bid as its board found the offer was not as attractive as the potential merger, according to a filing cited by the WSJ. Welltower’s offer was among others looked at by Healthcare Trust last year.
Welltower has since the fourth quarter of 2020 made about $7 billion in gross investments. The REIT also has acquired more than 29,000 senior living units in that time, representing an average investment of $20.6 million per property.
The REIT also continues to shrink its long-term care portfolio as the senior care segment represented just 5.2% of its total NOI in place at the end of 2021 — versus 10.1% at the end of 2020. Welltower completed $458 million of long-term care dispositions, including selling 21 of 25 ProMedica assets that were contributing to negative EBITDA.
Sister publication Senior Housing News reporter contributed to this article.
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