Ventas reports $1.1 billion in senior living investments in third quarter, touting business strategy built for wave of demand

With a strategy focused on the “megatrend of longevity,” Ventas is continuing to expand its private-pay senior living business through a focused, data-driven approach, according to executives — and it’s working, they say. In the third quarter alone, the Chicago-based real estate investment trust reported, it closed on $1.1 billion in senior living investments, and based on net operating income, its seniors housing operating portfolio, or SHOP, now represents half of its business, which also includes outpatient medical and research, triple-net healthcare and institutional private capital management.

During a third-quarter earnings call Thursday, Chairman and CEO Debra A. Cafaro called the REIT “one of the world’s largest owners and acquirers of private-pay senior housing” (the 2025 ASHA 50 from the American Seniors Housing Association puts it at No. 2 in senior housing ownership in the United States) and said the firm is positioned to capitalize on the sustained growth and demand from a rapidly aging population.

Over the past several years, Cafaro said, the company has added expertise, acquired more than $4 billion in senior living communities, converted communities from triple net leases to its SHOP, expanded its operator base, made significant strategic sales, increased its scale and improved its financial profile. 

The REIT’s strategy, she said, emphasizes expanding its senior living operating business organically and investing in senior living. Ventas, Carfaro said, has increased its SHOP percentage of NOI almost 2,000 basis points to represent half of its business in the past few years.

2025 is expected to be the firm’s fourth year of double-digit SHOP NOI growth. Year-to-date, the company has closed $2.2 billion in senior living investments, $1.1 billion of that in the third quarter. The company expects those investments to increase its growth rate on a multiyear basis. The REIT increased its senior living investment volume expectations for 2025 to $2.5 billion, up from the prior guidance of $2 billion. 

On the investment front, Cafaro said that Ventas is seeing a strong upward trend in transaction activity, and its pipeline continues to grow as the company ramps up the expansion of its SHOP portfolio.

“We’ve spent years building a platform that’s ready for this wave of demand in senior housing,” Executive Vice President of Senior Housing and Chief Investment Officer Justin Hutchens said of the Ventas Operational Insights, or OI, platform.  “We now have sophisticated data analytics and the ability to deliver those insights directly to our operators.”

The Ventas OI platform, Hutchens said, pulls in data from a community’s customer relationship management program, then articulates opportunities to improve across all key metrics, revenue and expenses, in a targeted way through pricing strategies, sales strategies and expense efficiency opportunities. Through the platform, he said, the company has enhanced its capital expenditures management, optimized pricing and developed broader capabilities to improve performance and support its 40 operators. 

Over the past five years, Hutchens said, the company has made 215 senior living acquisitions, 116 community sales, 295 community transitions to new managers, 307 community refreshes, and 157 conversions of low-occupied communities from triple-net leases to SHOP. 

Cafaro highlighted a one SHOP growth initiative, sharing that previously announced transactions relating to 121 triple-net leased senior housing communities are well underway. The company has converted from triple net leases to SHOP 27 of the 45 Brookdale Senior Living communities slated for management transitions by year-end. 

“We have conviction in our strategy, and we are intensifying our efforts to drive outperformance in our senior housing business, and the best is yet to come,” Hutchens said. 

Third-quarter results

In the third quarter, SHOP same-store cash net operating income increased 16% year over year, led by US growth of 19%. 

Third-quarter resident demand remained strong and broad-based, Ventas said. Same-store average occupancy increased 160 basis points compared with the second quarter and 270 basis points year over year — the best rates in the past four years, Executive Vice President of Senior Housing and Chief Investment Officer Justin Hutchens said. US same-store average occupancy grew 200 basis points sequentially and 340 basis points year over year.

Ventas reported that it anticipates occupancy growth of 270 basis points for the full-year 2025, driven by strong pricing as move-in rents and in-house rates are both increasing.