Key Takeaways
- • Welltower acquired the 339-unit Warner Center assisted living community at 6233 N. Variel Ave. in Los Angeles from Harbert South Bay for $230.3 million, or about $539 per square foot, according to a deed filed with L.A. County.
- • Harbert South Bay, the senior housing development arm of Harbert Management Corp., and the Bluhm family's LAMB Properties bought the 2.7-acre site for $15.3 million in 2018, making the sale roughly 15 times the land cost.
- • The Variel of Woodland Hills opened in 2022 with 215 independent living, 94 assisted living and 29 memory care units, and is operated by Momentum Senior Living.
- • The deal reflects Welltower's continued $40 billion senior housing acquisition strategy under CEO Shankh Mitra, as the REIT expands in California following an August purchase in San Jose for $99.6 million.
- • Warner Center is seeing a wave of senior housing development under the 2013 Warner Center Specific Plan, with Wellpointe's 3,200-unit Viva L.A. project unveiled in July.
Summary
Medical real estate investment trust Welltower has acquired the 339-unit assisted living community at 6233 N. Variel Ave. in Warner Center, Los Angeles, from senior housing developer Harbert South Bay for $230.3 million, or about $539 per square foot, according to a deed filed in L.A. County and a source with knowledge of the deal, as reported by the Los Angeles Business Journal. Spokespeople for Welltower and Harbert declined to comment.
The seller is the senior housing development arm of Alabama-based private equity firm Harbert Management Corp. Harbert South Bay, formerly South Bay Partners, and the Bluhm family's LAMB Properties teamed up to buy the 2.7-acre development site between Erwin Street and Victory Boulevard for $15.3 million in 2018. The joint venture demolished a vacant office building and broke ground in 2019 on The Variel of Woodland Hills, an eight-story community with 215 independent living units, 94 assisted living units and 29 memory care units. The property opened in 2022 and is operated by Laguna Niguel-based Momentum Senior Living. Harbert later became majority owner of the former Dallas-based South Bay Partners, which rebranded as Harbert South Bay.
The transaction underscores Welltower's push into the senior housing sector. Since 2020, CEO Shankh Mitra has led the Toledo, Ohio-based REIT on a $40 billion senior housing buying spree, which the Wall Street Journal reported in June is now paying dividends. Welltower's market value rose from about $47 billion in May 2020 to about $170 billion currently. Last year the company acquired more than 900 senior housing communities, according to its annual filing, including a $4.6 billion CAD deal for 38 senior housing properties and nine development sites across Canada from Amica Senior Lifestyles and the Ontario Teachers' Pension Plan. Welltower also paid $99.6 million all-cash in August for a 195-unit senior living community at 3355 Almaden Expressway in San Jose, according to The Mercury News.
The Variel project presaged a wave of senior housing construction in Warner Center, a former low-rise office and industrial district where city planners have incentivized denser development under the 2013 Warner Center Specific Plan. Wellpointe unveiled its 3,200-unit high-rise senior housing project, Viva L.A., in July. Separately, Los Angeles Rams owner Stan Kroenke is pursuing a $10 billion megadevelopment on the site of the former Promenade mall, including the planned permanent Rams Village headquarters, which he acquired in 2022.
The seller is the senior housing development arm of Alabama-based private equity firm Harbert Management Corp. Harbert South Bay, formerly South Bay Partners, and the Bluhm family's LAMB Properties teamed up to buy the 2.7-acre development site between Erwin Street and Victory Boulevard for $15.3 million in 2018. The joint venture demolished a vacant office building and broke ground in 2019 on The Variel of Woodland Hills, an eight-story community with 215 independent living units, 94 assisted living units and 29 memory care units. The property opened in 2022 and is operated by Laguna Niguel-based Momentum Senior Living. Harbert later became majority owner of the former Dallas-based South Bay Partners, which rebranded as Harbert South Bay.
The transaction underscores Welltower's push into the senior housing sector. Since 2020, CEO Shankh Mitra has led the Toledo, Ohio-based REIT on a $40 billion senior housing buying spree, which the Wall Street Journal reported in June is now paying dividends. Welltower's market value rose from about $47 billion in May 2020 to about $170 billion currently. Last year the company acquired more than 900 senior housing communities, according to its annual filing, including a $4.6 billion CAD deal for 38 senior housing properties and nine development sites across Canada from Amica Senior Lifestyles and the Ontario Teachers' Pension Plan. Welltower also paid $99.6 million all-cash in August for a 195-unit senior living community at 3355 Almaden Expressway in San Jose, according to The Mercury News.
The Variel project presaged a wave of senior housing construction in Warner Center, a former low-rise office and industrial district where city planners have incentivized denser development under the 2013 Warner Center Specific Plan. Wellpointe unveiled its 3,200-unit high-rise senior housing project, Viva L.A., in July. Separately, Los Angeles Rams owner Stan Kroenke is pursuing a $10 billion megadevelopment on the site of the former Promenade mall, including the planned permanent Rams Village headquarters, which he acquired in 2022.
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