Funding funds managed by Morgan Stanley Funding Administration have collectively acquired a three-community portfolio from personal fairness group Kayne Anderson for $305 million.
Morgan Stanley Actual Property Investing (MSREI) manages the funding fund, and the portfolio contains 463 items in three communities close to Denver. MorningStar Senior Residing will stay the supervisor of the properties after the sale to the funds managed by MSREI.
Morgan Stanley Actual Property Investing Head of U.S. Investments Will Milam instructed Senior Housing Information on Thursday that the corporate’s funding thesis in senior housing has been “constant” during the last 4 years, focusing on “high-performing properties with greatest at school operators.”
“This transaction matches in with MSREI’s funding technique of partnering with best-in-class operators to amass prime quality communities with a continuum of care and fashionable facilities,” Milam instructed SHN.
Since 2022, MSREI has partnered with three senior dwelling operators and has invested in 30 senior dwelling communities, based on Milam. Its typical investments embrace impartial dwelling, assisted dwelling and reminiscence care, or assisted dwelling and reminiscence care companies, Milam famous.
“Demand for every sort can differ by market and the wants of the native resident base, however we do discover that impartial dwelling is a useful feeder into assisted dwelling/reminiscence care companies and gives a smoother transition into the next degree of take care of the residents,” Milam stated.
Dynamics driving MSREI’s newest exercise within the sector embrace continued demographic demand and the dearth of recent building, which Milam stated helps “outsized prime line progress, and enticing valuation ranges [that] present compelling return potential,” for traders.
Looking forward to 2026, Milam expects enticing funding situations “to persist” into 2026.
In December of final 12 months, MSREI acquired an eight-community portfolio from Brightview Senior Residing and Harrison Road, as the corporate on the time had been “actively investing in senior housing for the reason that sector was dislocated throughout the Covid-19 pandemic.”
Earlier in 2024, Morgan Stanley Smith Barney (NYSE: MS) created a non-traded actual property funding belief (REIT) aimed toward business actual property funding. Whereas senior housing shouldn’t be a core goal, North Haven Internet REIT included senior housing funding in a variety of sectors for future potential transactions.
In a press release on Thursday, MorningStar President and Chief Funding Officer Jamie Ranzan stated the corporate stays dedicated to partnering with “like-minded organizations” like Morgan Stanley, because the latest transaction marks an “thrilling new chapter for each events.”
This 12 months, MorningStar has been “strategically refocusing” and “deepening” its relationships with current capital companions to align with “massive institutional teams that share our ambition to be the premier operator in each market we serve,” Ranzan stated.
“Our method to partnership is very selective, and we’re honored to develop our relationship with Morgan Stanley by means of this milestone transaction,” Ranzan added.
In 2023, SHN SHN profiled MorningStar’s efforts to maneuver from pandemic-era challenges to stabilization and improved working efficiency, centered on “threading a needle between prices and income in the event that they hope to achieve success within the post-pandemic age.” Final 12 months, MorningStar additionally opened MorningStar at The Canyons, a brand new senior dwelling neighborhood in Las Vegas.
