Atria Completes Capital Raise for $1B Development Pipeline with Fremont, Ventas

by Jeff Shaw

LOUISVILLE, Ky. — Senior executives for Atria Senior Living sold 50 percent of their existing ownership interest in Atria’s business to Fremont Realty Capital as part of a capital raise for a $1 billion seniors housing development pipeline.

Fremont Realty Capital is the real estate private equity business unit of the Fremont Group, the investment office of the Bechtel family of San Francisco. In addition to that company’s transaction, giant healthcare REIT Ventas also increased its existing investment in the company to maintain its 34 percent ownership stake without dilution.

The transactions will result in Atria’s senior executives, Fremont and Ventas owning both Atria’s management services business and the newly formed real estate development venture in 33 percent, 33 percent and 34 percent shares, respectively. The venture intends to raise an additional $300 million to $400 million of limited partner capital to fund the development and redevelopment strategy.

The development pipeline will specifically focus on high-barrier-to-entry markets, though further details were not disclosed.

“With this additional capital we can continue to build scale and accelerate our investments in infrastructure and systems to better position us for both the current environment and our maturing industry as it prepares for the demographic wave that is around the corner,” says John Moore, Atria Senior Living chairman and CEO. Moore was referring to the large number of Baby Boomers approaching retirement age.

Atria has increased the number of communities it manages on a long-term basis from 125 to over 200, doubling revenue under management since 2011 when Ventas purchased substantially all of Atria’s real estate. Atria now operates in 28 states and seven Canadian provinces, for Ventas as well as over 10 other real estate owners.

Louisville-based Atria already has significant market presence in high-barrier-to-entry markets, including metropolitan New York, the Bay Area of Northern California, Southern California and Boston. It employs more than 16,000 people and is home to over 20,000 residents.

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