A California company entered Arizona with a top-dollar purchase of four senior housing properties, the latest sign of record demand from an aging population for a type of real estate strongly rebounding from pandemic declines.

Clearwater Living, based in Newport Beach, California, and joint venture partner PGIM paid $255 million to buy the properties in Phoenix, Scottsdale and Gilbert totaling 554 units from Tempe-based multifamily developer Liv Communities, according to public sale documents. Representatives of LivCommunities didn't respond to a request to comment from CoStar News.

The sale of the independent living, assisted living and memory care properties is the highest total price on record paid for a senior housing portfolio in Arizona, and one of the largest in the United States this year, according to CoStar data.

It comes as senior living facilities are getting bought across a variety of regions. And these properties are poised for increased demand over the next 10 years as the baby boomer population ages and retires, according to the National Investment Center for Seniors Housing & Care, better known as NIC.

“Private owners and operators remain the most active acquirers in the seniors housing and care market as they look to build local and regional scale and efficiencies,” Ben Swett, senior care analyst at Irving Levin Associates, a New Canaan, Connecticut-based consulting firm that tracks the sector, said in a statement with Irving Levin's third-quarter market report. “Private capital continues to flood into the skilled nursing sector at very high per-bed values, as well.”

Renter demand for senior housing units increased in the second quarter at the strongest pace ever recorded, rising nearly a full percentage point from the first quarter to 81.4%, and up by 3.5 percentage points from its pandemic low of 78% in the second quarter of 2021, NIC chief economist Beth Mace said in an email.

Nearly 80% of the units that were vacated at the height of the pandemic have been reoccupied since the second half of last year, Mace said.

Another reason for the heightened demand is a slowdown in senior housing construction in Phoenix and across the United States since the onset of the pandemic. The roughly 35,000 units under construction in the second quarter across the 31 U.S. cities tracked by NIC was the fewest for a second quarter since 2015, according to Mace.

Demand for skilled nursing, assisted living and other long-term housing for seniors has boosted occupancy rates and investment sales, which approached $19 billion in 2021, the strongest year since 2015, according to a Colliers report.

Among the other high-dollar senior housing and care facilities deals this year, an affiliate of Rood Investments of Vancouver, Washington, sold a three-property portfolio of senior living facilities in Vancouver to Toledo, Ohio-based healthcare REIT Welltower for nearly $225 million in April.

In October, CareTrust REIT, a California company that acquires and leases senior housing and healthcare properties nationwide, sold seven skilled nursing and seniors housing complexes in Ohio totaling more than 700 beds to a regional operator for $52 million.

Rents for both housing and nursing care rose between 2% and 2.4% in 2021, Aaron Jodka, national director of capital markets research at Colliers, said in an email.

Clearwater said in a statement that "our acquisition of these four Arizona-based communities reflects our ambitious expansion into a new state and our continued evolution as a company."

Clearwater also owns and operates five senior care facilities in California and Nevada, according to its website. Its expansion is just beginning, with the company looking to add properties in several Western states, Clearwater Living President Danielle Morgan told Senior Housing News earlier this month.

The company experienced strong leasing that beat expectations during the worst of the pandemic, Morgan added.

Newmark represented seller Liv Communities in the transaction.