In what analysts are calling the biggest skilled nursing deal in over two years, SouthCare Health Partners has completed its acquisition of 45 skilled nursing facilities across five southeastern states for approximately $820 million. The transaction, which closed on January 15 after receiving regulatory approval in all affected states, makes SouthCare the third-largest SNF operator in the Southeast with a portfolio of 112 facilities.
Deal Details
The acquired facilities, previously operated by Heritage Senior Living, span Georgia (14 facilities), Alabama (10), South Carolina (8), Tennessee (8), and Mississippi (5). The portfolio includes approximately 5,400 licensed beds and generates an estimated $480 million in annual revenue, with a payer mix of roughly 55% Medicaid, 30% Medicare, and 15% private pay and managed care.
The transaction was structured as an asset purchase, with SouthCare assuming operations and retaining the majority of existing staff. Heritage Senior Living cited “strategic realignment” as the reason for the divestiture, though industry observers note that several of the divested facilities had experienced regulatory challenges and below-average quality ratings in recent years.
Market Impact
The acquisition reshapes the competitive landscape across the five-state region. In Georgia and Alabama, SouthCare now operates the largest number of skilled nursing beds, surpassing established regional players. The increased scale gives SouthCare greater leverage in managed care contract negotiations, group purchasing arrangements, and labor market competition.
Real estate analysts value the transaction at approximately $152,000 per bed, which is in line with recent comparable transactions in the Southeast but below the $175,000-$200,000 per-bed valuations seen in higher-reimbursement states like New York and Massachusetts.
Quality Concerns
Patient advocacy groups have raised concerns about the pace of consolidation in the skilled nursing sector, noting that rapid acquisitions can disrupt care continuity. Of the 45 acquired facilities, 12 currently hold below-average quality ratings (1 or 2 stars) on CMS’s Care Compare website.
SouthCare has pledged to invest $35 million over the next 18 months in facility upgrades, technology improvements, and staffing enhancements at the acquired properties. The company says it plans to bring all facilities to at least a 3-star rating within two years.
M&A Outlook
The SouthCare deal is likely a harbinger of increased M&A activity in 2026. With interest rates stabilizing and several large operators signaling portfolio optimization strategies, brokers report a growing pipeline of transactions in the $50-500 million range. The Southeast and Midwest remain the most active markets, driven by favorable demographics and relatively lower per-bed valuations.
For operators considering strategic alternatives, the current environment favors sellers with clean regulatory histories and diversified payer mixes. Facilities with strong Medicare Advantage relationships are particularly attractive to buyers seeking revenue predictability.