American Healthcare REIT Prices $712 Million Forward Equity Deal for Kensington Portfolio

The forward structure defers share issuance for as long as two years, leaving the credit facility, assumed agency debt and cash on hand to carry the purchase at closing.

August 12, 2026

American Healthcare REIT has priced a 13.25 million share equity offering at $53.75 per share, raising roughly $712.2 million in gross proceeds that the Irvine, California-based healthcare landlord expects to direct principally toward an $873 million purchase of eight luxury senior housing communities operated by Kensington Senior Living.

The entire offering is being executed through forward sale agreements with Morgan Stanley, Citibank and KeyBanc Capital Markets, meaning the company receives nothing at closing. The forward purchasers and their affiliates borrow the shares from third parties and sell them to the underwriters, and American Healthcare REIT collects the money only when it physically settles — anticipated within approximately 24 months. Assuming full physical settlement at the forward sale price of $53.4176 per share, net proceeds would total about $707.1 million, rising to roughly $813.3 million if the underwriters exercise their option for an additional 1,987,500 shares within 30 days.

The Kensington Portfolio

The pending acquisition, agreed on August 10 under three separate purchase agreements, covers 745 units across California, Maryland, New York and Virginia: two properties in the Los Angeles metro, one in the San Francisco metro, four in the Washington, D.C. metro and one in the New York metro. The price includes approximately $56.46 million of existing Kensington agency debt carrying a 6.35 percent annual rate, which the buyer will assume, and excludes closing costs and prorations.

The assets skew heavily toward higher-acuity care. As of June 30:

• roughly 93 percent of beds were dedicated to assisted living and memory care;
• six of the eight properties had opened in 2015 or later;
• average occupancy stood at 90.2 percent, including one community still in lease-up;
• revenue per occupied room typically ranged from about $18,000 to $25,000 a month.

American Healthcare REIT expects the properties to land in its senior housing operating properties segment and believes the deal will lift normalized funds from operations growth in year one, come in consistent with its general acquisition yield targets, and price below estimated replacement cost. Kensington is expected to stay on as operator under management agreements with a subsidiary of one of the company’s taxable REIT subsidiaries, preserving the RIDEA arrangement the REIT uses across its operating portfolio. Kensington developed seven of the eight communities and has run all eight since developing or acquiring them; its management team carries more than 30 years of senior housing experience, including earlier leadership roles at Sunrise Senior Living.

Closing is expected after August 31, subject to customary conditions including healthcare regulatory approvals and licensure and the negotiation of definitive management agreements. Either party may terminate under specified circumstances. The offering and the acquisition are not cross-conditioned in either direction; if the portfolio deal falls apart, the proceeds are earmarked for general corporate purposes and potential future investments.

Why the Forward Structure Matters

The gap between an acquisition closing in the fall and settlement proceeds that may not arrive for two years is bridged by the rest of the capital stack. The company intends to fund the purchase price with some combination of offering proceeds, borrowings under its 2026 credit agreement, the assumed debt and cash on hand.

Until settlement, the shares underlying the forward agreements are reflected in diluted per-share calculations using the treasury stock method, so there is no dilutive effect on earnings or funds from operations per share except when the average market price runs above the adjusted forward sale price. That price does not sit still: it is adjusted daily by a floating interest rate factor equal to a specified daily rate less a spread, and reduced on set dates by the amount per share of expected quarterly dividends over the term.

The structure carries counterparty risk in one direction as well. Each forward purchaser can accelerate settlement and compel physical delivery on triggers that include an inability to borrow shares at an acceptable cost, extraordinary dividends, breached ownership thresholds, and announced extraordinary events such as a merger, tender offer or delisting. That decision would be made without regard to the company’s own capital needs.

A Steady Cadence of Equity Issuance

The offering extends an unusually active year of equity raising. The company established a $1.75 billion at-the-market program on February 27, terminating its predecessor the same day, and layered forward sale agreements with maturities running through July 2027 on top of it. In May, it completed a follow-on offering of 16.1 million shares for gross proceeds of $811.44 million, including full exercise of the underwriter’s option, again using forwards that push delivery out as far as May 2028.

As of August 7, 12,246,596 shares sold under the at-the-market program and the May offering remained unsettled, representing roughly $630.5 million in gross proceeds at an average price of $51.49 per share. Against 217,998,775 shares outstanding on that date, full settlement of the current offering alone would bring the count to 231,248,775. The company, its officers and its directors agreed to a 30-day standstill, though the at-the-market program becomes available again after 30 days or upon full exercise of the underwriters’ option, whichever comes first.

Deployment Pipeline

The capital is going out the door quickly. Acquisitions completed between January 1 and August 10 carried an aggregate contract purchase price of approximately $1.4 billion. As of August 10, the pipeline held executed purchase agreements totaling $953 million, the Kensington portfolio included, plus non-binding letters of intent worth an expected $382.7 million. Management expects most, if not all, of those to close by year end. On underwriting, the company targets going-in yields of mid-5 percent to mid-6 percent and stabilized yields above 7 percent, with a stated focus on needs-based senior housing operating properties.

That focus shows up in the existing footprint. As of June 30, the integrated senior health campuses segment comprised 148 campuses across seven states with 8,137 skilled nursing beds and 6,960 senior housing units, at an average building age of 13.7 years. The senior housing operating properties segment spanned eight regional operators in 21 states, with 6,694 assisted living and memory care units out of 8,042 total and an average age of 20.9 years. The Kensington assets would add newer, denser, higher-rate inventory to the younger of the two segments.

Shares closed at $55.47 on the New York Stock Exchange on August 10, the day the offering was priced. Underwriting discounts and commissions run $0.3324 per share, or $4.4 million in total, with offering expenses estimated at $675,000. The push into needs-based senior housing follows the leadership reshuffle in July, when the board named Jeff Hanson chief executive and elevated Gabe Willhite to president.