Blackstone Has Been Offloading Its $1.8B In Senior Housing At A Massive Loss
Real estate giant Blackstone has been quietly unloading most of its senior housing properties after pandemic-era hurdles and high interest rates have led to severe losses.
The firm began selling off its senior housing portfolio, which consists of roughly 9,000 senior housing units, in 2022 through a series of one-off transactions, The Wall Street Journal first reported.
So far, Blackstone has sold roughly 70 of the 90 properties in its senior housing portfolio, and it is in talks to sell the remaining properties. The firm has lost roughly $600M on these sales.
Blackstone made a massive investment in the sector in 2016, grabbing a 64-property portfolio from HCP for $1.1B. A year later, Blackstone acquired another portfolio for $747M from Welltower.
Of 39 properties sold between 2022 and 2025, Blackstone bought them for $755M but sold them for 29% less, roughly $536M, according to the WSJ.
Most of the senior housing stock was value-add, middle-tier properties the firm hoped to build up to sell for profit. With the pandemic, however, demand for senior housing decreased. Macroeconomic factors, including high interest rates and labor costs, also drove up the costs of operating these facilities.
A Blackstone spokesperson downplayed the impact the write-downs have had on Blackstone's portfolio.
“These properties sit in a $33.5 billion fund that has nearly doubled investors capital,” the spokesperson said in an emailed statement. “These properties, like much of the senior housing sector, were significantly impacted by COVID.”
The firm made more than $100M in investments in the portfolio, the spokesperson said. But the $1.2B in floating-rate financing Blackstone had on the portfolio was impacted by higher interest rates. This led roughly two dozen properties financed by the loans to be transferred to special servicing, the WSJ reported.
Despite Blackstone's losses, the senior housing sector is booming, with big investors coming in to swoop up properties.
Year-over-year inventory growth for senior housing was the smallest since 2006, at just 1%. This constrained construction pipeline is pushing occupancy rates near historic highs, according to the Urban Land Institute and PwC's 2026 Emerging Trends in Real Estate report.
Earlier this week, Sonida Senior Living acquired rival senior housing REIT CNL Healthcare Properties for $1.8B in a stock and cash deal, marking the largest senior housing transaction in the country since 2021. Other senior housing real estate players, including Clarion Partners and Welltower, have announced heightened focus on the sector as a wave of senior housing demand is expected to splash down on the market.
