Ventas (NYSE: VTR) is transferring full velocity forward on senior housing acquisitions and investments, with over $800 million closed and a goal of $2.5 billion in 2026.
The REIT is aggressively increasing its senior housing working portfolio (SHOP), which as of the tip of the fourth quarter of 2025 includes 53% of the corporate’s annual internet working revenue (NOI).
Giving the corporate’s leaders confidence in that technique is the truth that its senior housing working companions have steadily grown occupancy and income over the previous few years.
“We count on SHOP to supply our fifth consecutive yr of double-digit, same-store money NOI progress, with occupancy, price, and margin all displaying wholesome, year-over-year, will increase,” Debra Cafaro, CEO of Ventas, mentioned in the course of the Chicago-based actual property funding belief’s (REIT’s) fourth-quarter 2025 earnings name on Feb. 6. “Our number-one capital allocation precedence stays U.S. senior housing.”
Ventas’ $800 million funding in 2026 is unfold throughout seven transactions, and brings Ventas’ funding complete within the final 12 months as much as $4.8 billion. In response to Justin Hutchens, government vice chairman of senior housing and chief funding officer, Ventas sees “a broader and extra numerous set of potential transactions available in the market throughout a spread of funding profiles.”
To maintain its pipeline full Ventas is in search of investments that “mix sturdy, in place money move and progress with the potential to generate engaging, threat adjusted returns,” Hutchens mentioned.
“There’s loads of exercise general within the U.S., and we’re getting greater than our justifiable share of that,” he mentioned.
Because it has grown within the U.S., Ventas’ variety of holdings in Canada have shrunk from totaling about 30% of the REIT’s senior housing working portfolio (SHOP) just a few years in the past right down to 16% at the moment.
Normalized funds from operations within the fourth quarter have been $0.89, up 10% yr over yr.
BMO Capital Markets Analysts Juan Sanabria and John Kim wrote that Ventas’ SHOP section progress is regular with strong income per occupied room (RevPOR).
The REIT’s inventory is priced at $82.55, up 3.4% from the earlier shut.
Ventas brings momentum of ‘proper market, asset, operator’ into 2026
On the coronary heart of Ventas’ funding thesis is a method that its leaders have dubbed “proper market, proper asset, proper operator.” In a nutshell, the REIT has a playbook of operational insights supported by plenty of information with which it helps its working companions.
The REIT added 11 communities to its SHOP section within the fourth quarter of 2025 representing 1,443 models and a mean value of about $209,000 per unit, in line with its newest monetary disclosure.
Ventas secured half of the roughly $800 million it has invested to this point in 2026 and subsequent to the tip of 4Q25 by means of off-market transactions, in line with Hutchens. He mentioned the corporate has constantly acquired properties beneath substitute prices, however he has seen some alternatives the place costs are trending nearer to substitute.
“We’ve had some very nice, high-quality, newer communities that you simply’re shopping for at nearer to substitute prices. We have now, we’ve others which can be method beneath nonetheless,” he mentioned in the course of the name Friday.
In an interview after the decision, Hutchens advised SHN that he believes the corporate has the wind at its again in 2026 given a number of positive factors within the fourth quarter of 2025.
Common occupancy for the REIT’s 746-community SHOP section registered at 88.6% within the fourth quarter of 2025, representing a achieve of 230 foundation factors versus 4Q24. The section’s money NOI margin within the fourth quarter of 2025 was 28.2%, a achieve of 160 foundation factors in contrast with the identical interval in 2024. RevPOR elevated 8% in that point, ending the fourth quarter at $5,332.
The corporate’s 651 U.S.-based properties have “been a progress engine for us, each organically and externally,” Hutchens mentioned. Likewise, the corporate’s 84 properties in Canada “ship terrific care and providers and monetary outcomes.”
Ventas’ $800 million funding complete shall be only a begin of its enlargement in 2026, Hutchens mentioned. The corporate is particularly in search of to purchase bigger communities with a continuum of care. The corporate’s final 12 months of senior housing transactions have spanned 44 offers, with communities round 12 years previous on common. Ventas stored the present operator in 38 of the 44 offers.
“Our platform is de facto constructed to handle numerous operators. We have now 43 in our SHOP portfolio at the moment, and we’ve been additionally shopping for comparatively newer product,” Hutchens mentioned. “We’ve been bettering the standard of the portfolio as we’ve been rising.”
Whereas Ventas has acquired some communities close to or north of the 90% occupancy watermark, Hutchens mentioned he sees much more room forward for enchancment in a lot of them.
“If you happen to’re 90% you’ve gotten 10% to go. And when you’ve gotten markets which can be projected to go all the best way to 100% occupancy over the following few years, that’s a really cheap expectation,” he mentioned in the course of the earnings name. “We actually just like the portfolio positioning and the chance to develop occupancy.”
Extra capital sources have deployed {dollars} in senior residing within the final yr, which has elevated competitors for belongings, Hutchens mentioned. As a result of measurement and presence of Ventas, he added it hasn’t slowed them down and there’s a “drifting down” in cap charges.
“I might describe the pipeline as rising. It’s definitely turning into bigger,” he mentioned. “We’re seeing extra mid-sized offers … there’s extra alternatives than we had a yr in the past.”
‘We like acquisitions’ over growth
Ventas is not any stranger to growth, however the firm nonetheless is very favoring acquisitions in 2026.
With the intention to get again into growth, Hutchens believes that common senior residing rents must be as a lot as 20% to 30% to assist “even a comparatively modest growth yield.” Due to that dynamic, Hutchens mentioned he thinks solely “ultra-premium” new-build initiatives will transfer ahead within the close to future, “and that’s a product that’s so differentiated by way of worth, once they enter a market … they’re nicely positioned to be the worth chief.”
“It’s nonetheless going to take a while. Rents must catch up, and once they do … you’ve gotten a three-year runway, and when that provide opens, you’re hitting this super quantity of demand,” Hutchens mentioned on the decision.
Though the senior residing trade has struggled to develop middle-market senior housing communities at scale, Hutchens isn’t nervous that Ventas’ working companions will wrestle to draw residents to their communities.
For one, the corporate has companions with mid-market manufacturers at varied factors throughout the continuum. And in line with Ventas administration, On common, residents can afford to remain in communities inside the portfolio for six.7 occasions longer than trade averages, based mostly on revenue and internet value relative to value of care, in line with supplemental materials for traders.
