Black Friday of the Retirement Housing Coming

Chartwell Seniors Housing Real Estate Investment Trust intends to buy $625-million worth of properties this year, and will take a look at two competitors that are up for sale.

Asked yesterday about rumours Chartwell might bid for Retirement Residences Real Estate Investment Trust or Extendicare Inc., Chartwell president Stephen Suske said: "We would be interested in looking at these particular opportunities."

"There are a number of other opportunities in long-term care in Ontario that are also available, and we think as a buyer we're in a very good position to pick and choose," he added during a conference call.

The Mississauga-based trust released its 2005 results yesterday, saying it spent $435.2-million last year to buy interests in 28 seniors' housing sites. That exceeded its acquisition target of $400-million.

The total portfolio of properties that Chartwell owns or manages grew 46 per cent, to 19,679 suites at 165 seniors' homes, and Chartwell now plans to buy $625-million worth of properties this year.

About $125-million to $150-million of that will be spent in the United States, which "is a very buoyant market for us," Mr. Suske said.

But much of the spending will be done north of the border, where the seniors' housing industry remains highly fragmented. The 10 biggest companies account for only 23 per cent of available suites for seniors in Canada, Chartwell said.

Retirement Residences REIT is the largest owner of Canadian retirement homes, with more than 200. Earlier this month, it disclosed that it has received numerous expressions of interest from potential buyers.

Then, last week, Extendicare said it is considering strategic options including a sale. Markham, Ont.-based Extendicare owns 439 nursing homes and assisted living centres, 77 of which are in Canada.

One analyst who follows the sector said that Extendicare "is probably way too complex" for Chartwell.