Welltower (NYSE: WELL) is growing its relationship with Oakmont Management Group in an arrangement that will grow the companies’ existing portfolio and facilitate the launch of a new brand called Ivy Living.
The Toledo, Ohio-based real estate investment trust (REIT) on Thursday announced it is acquiring an undisclosed number of management contracts that are expected to “roughly double the size of Welltower and Oakmont’s existing portfolio by the end of the third quarter in affluent markets across California.”
Welltower’s current Oakmont portfolio consists of nine assisted living and memory care communities.
Though a representative for Welltower did not elaborate on the new arrangement when reached by Senior Housing News Thursday, the REIT did publicly share details of a recent acquisition involving the two companies.
Oakmont and Welltower together bought Ivy Park at Otay Ranch, an assisted living and memory care community in San Diego, California. That community will be operated under a new Oakmont brand, Ivy Living, which “builds upon decades of operational excellence providing Oakmont the flexibility to pursue opportunities that have a different built environment,” according to Welltower.
The pro rata purchase price for Otay Ranch was $35 million, according to Welltower’s Q2 2021 earnings announcement, released Thursday.
A representative for Oakmont did not immediately respond to a request for more information from SHN. But Oakmont’s website reveals the provider is possibly planning to open six communities across California in August under the Ivy Park name. The communities will offer a “whole living” approach to assisted living and memory care, according to the website for Ivy Park at Otay Ranch.
Welltower is also expanding its relationship with Oakmont through a new long-term exclusive development agreement. As part of that arrangement, both companies will “invest significant capital and resources” to build, own and manage senior living communities.
“Oakmont is one of Welltower’s strongest performing operating partners,” said Welltower CEO Shankh Mitra in a press release. “I could not be more excited to significantly grow our relationship through acquisition and development in California and other western states over the next decade.”
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Welltower has forged new ties or significantly grown its relationships with several operating partners this year, including active adult providers Treplus Communities and Sparrow Partners. The company was also a player in Atria Senior Living’s acquisition of Holiday Retirement when it bought the 86 properties that Holiday owned and self-managed for nearly $1.6 billion in June.
Welltower is not the only company interested in growing its relationship with Oakmont. In June, Harrison Street acquired a 24-property portfolio operated by Oakmont Management Group for about $1.2 billion.