Merrill Gardens partners with REIT on assisted living centers

Seattle retirement community developer Merrill Gardens is putting nearly half its portfolio — including 14 communities in Washington — into a partnership that would be mostly owned by a giant Ohio-based real-estate investment trust.

By Seattle Times business staff

Seattle retirement community developer Merrill Gardens is putting nearly half its portfolio — including 14 communities in Washington — into a partnership that would be mostly owned by a giant Ohio-based real-estate investment trust.

The partnership between Merrill and Health Care REIT of Toledo was announced Wednesday. It would own 38 senior communities — 25 that now belong to Merrill, 13 now owned by Health Care.

Health Care, which valued the joint venture at $817 million, would have an 80 percent interest in the partnership, Merrill 20 percent. Merrill would manage all 38 properties.

Health Care would pay Merrill an unspecified amount of cash and assume a pro-rated share of $249 million in Merrill debt, according to a prepared statement.

The partnership also would have the right to buy nine more Merrill communities.

The companies said the deal is expected to close next month. Representatives of the two firms were not available for comment late Wednesday.

A complete list of the affected communities in Washington was not immediately available. They include Merrill Gardens properties in Seattle's Queen Anne and West Seattle neighborhoods and in Mill Creek.

"We want to emphasize that the Merrill family will continue to own and operate Merrill Gardens so there will be no change in our day-to-day operations for our residents and team members as a result of this partnership," Merrill Gardens President Bill Pettit said in the statement.

Merrill Gardens and Health Care REIT have a long relationship, according to the statement. Merrill has managed Health Care retirement communities, and the two companies have formed partnerships before to acquire communities.

Privately held Merrill Gardens, founded by Seattle's pioneer Merrill family in 1993, owns and operates 56 retirement communities in 10 states, according to its website.

Publicly traded Health Care REIT owns 625 properties, including senior communities and medical office buildings, in 39 states. It values its portfolio at $6.9 billion.